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BUSINESS FINANCING GLOSSARY

Cost of Goods Sold (COGS)

The direct costs of producing what you sell, mainly materials and labor. Revenue minus COGS is your gross profit.

Related terms

Gross Margin→Revenue minus the direct cost of goods sold, as a percentage of revenue. It shows how much each sale contributes before overhead.Gross Profit→Revenue minus the cost of goods sold, before operating expenses. What’s left to cover overhead and profit.

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