Cost of Goods Sold (COGS) is the cost of producing the products sold by the company. The amount of COGS is based on how much cost of production such as raw materials, labor wages, distribution cost, etc. The cost of goods sold is also referred to as the "Cost of Sales"

On DealPOS, there are 3 calculations for COGS when doing Re-Stock products. These are Manual, Average, and Last Order. You can choose one of these calculations according to your needs. To set up the COGS for your company, you can follow the steps below.

Table of Content :

I. How to Configure

II. How the COGS Work


I. How to Configure

Step 1. Go to Setup Menu and Click More Menu then choose Module

Setup COGS

Step 2. Choose the "Buy" tab menu, then you can set COGS Calculation

COGS Calculation

COGS Calculation :

You can see the table below to see how those three kinds of COGS calculations will work according to your needs:

Column

Description

Manual

Manual Calculation, The products cost will be set according to the buying cost that has already been entered the first time when you add the products

Average

Average Calculation, The products cost will be calculated according to these formulas =


{( Last Price * Old qty + New Price * New qty ) / (Old qty + New qty)}

Last Order

The product's cost will be set according to the Last Buying Cost from the products

*FIFO

COGS according to the first order

Notes :

Currently, DealPOS cannot support the FIFO calculations for COGS anymore.


II. How the COGS Work

The example below will tell you how those 3 types of COGS will work:

Manual COGS:

Step 1. Set the COGS to Manual as shown in the first step above. Go to Product set the product buying cost

For the example, we try to set the product "Meeting Table" Buying Cost to Rp200.000

Buying Cost Product

Step 2. Buy the product in the Buy menu with a different Buying Cost from the Buying cost product

Then we bought the product for 1 qty, but with different Buying Cost, the new Buying cost is Rp250.000.

Make Purchase with COGS Manual

Step 3. Go to product, see the variant detail from that product

Buying Cost Product Manual COGS

The buying cost from that product will not be changed and always be the same as the first time we input the Buying Cost product when we create the product

Average COGS

Step 1. Set the COGS to Average as shown in the first step above. Go to Product and set the product buying cost

For the example, we try to set the product "Meeting Table" Buying Cost to Rp200.000

Buying Cost Product

Step 2. Buy the product in the Buy menu with a different Buying Cost from the Buying cost product

Then we bought the product for 1 qty, but with a different Buying Cost, the new Buying cost is Rp300.000.

Make Purchase with COGS Average

Step 3. Buy the product for the 2nd time in the Buy menu with a different Buying Cost from the Buying cost product

After the first purchase, then we bought the product for 1 qty again, but with a different Buying Cost than before, the new Buying cost is Rp100.000.

Make Purchase with COGS Average

Step 4. Go to product, see the variant detail from that product

Buying Cost Product COGS Average

The buying cost from that product will be changed according to the average Buying cost from those 2 Purchase transactions with different buying costs. As you can see from the image above, the product's cost is changed to Rp200.000 after we've made 2 Purchases with different Costs. The first purchase was Rp300.000 and the 2nd purchase was Rp100.000. Then, the calculation will be like this:

{( Last Price * Old qty + New Price * New qty ) / (Old qty + New qty)}

The first transaction counted as this:

(0*200,000) + (1*300,000) / (0+1) = 300,000

And the second transaction counted as this:

(1*300,000) + (1*100,000) / (1+1) = 200,000

Then the final result from that product's Buying cost will be set to Rp200.000

Last Order COGS

Step 1. Set the COGS to the Last Order as shown in the first step above. Go to Product and set the product buying cost

Buying Cost Product

For the example, we try to set the product "Meeting Table" Buying Cost to Rp200.000

Step 2. Buy the product in the Buy menu with a different Buying Cost from the Buying cost product

Then we bought the product for 1 qty, but with a different Buying Cost, the new Buying cost is Rp300.000.

Make Purchase with COGS Last Order

Step 3. Go to product, see the variant detail from that product

Buying Cost Product COGS Last Order

The buying cost from that product will be changed according to the Last Buying Cost that we set before when making a Purchase Transaction with a different cost.


You might like to read these related articles below :


dealpos-trial-indonesia

Did this answer your question?