Level 1

Cost of Goods Sold

I have a gourmet food business with a dozen or so products.  Each product has a different final cost to me, based on the co-packer cost (which already includes ingredients and labor), cost of the jar, lid, label, and freight. I order the jars, lids, and labels myself.  To get the proper cost of goods sold for each item:

1) Should I enter the jars, lids, and labels as inventory when I purchase them?  I'd like to keep track of how many of each I have and track them as each jar is sold as part of the COGS.

2) How do I keep track of the COGS of each item when it sells?  Is the product itself the "parent" and each cost involved is a "sub account"? I don't want each little cost involved listed on the invoice to a customer.

 

Thank you for any help you can offer.  I haven't found an exact situation in the community that fits my situation.

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