We manufacture and sell a variety of items. I am just setting up Quick Books and am not sure how to enter information for items that we manufacture ourselves. For example, we have a product we sell for $10. It costs us $5.25 to make it. When we are entering that into inventory, should we put $5.25 as the cost of goods sold since that is what it costs us to make it? Or should i put 0 since we don't actually purchase the finished item and the cost for us to make it is included in our purchase of raw materials and the amount we pay to our workers for labor. Having our costs will help us do analysis i.e which products are most profitable - but will it double count the expenses if each time we sell a product it lists it as 5.25 expense from the cost of goods sold?
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