# What is my COGM?

Computes the cost of goods manufactured (COGM) from direct materials, direct labor, manufacturing overhead and work in process, with cost of goods sold.

- Page: https://www.acalculator.org/finance/cogm-calculator
- JSON spec: https://www.acalculator.org/finance/cogm-calculator.json
- Version: 1d4147e54cae

## Default answer

Example with the default inputs (Direct materials Materials used, Direct materials used $15,000.00, Direct labor $25,000.00, Manufacturing overhead $23,000.00, Work in process at the start $75,000.00, Work in process at the end $43,000.00, Finished goods at the start $65,000.00, Finished goods at the end $58,000.00): Direct labor of $25,000.00 and overhead of $23,000.00 bring total manufacturing costs to $63,000.00, and the cost of goods manufactured is $95,000.00.

## Inputs

| Key | Label | Description |
| --- | --- | --- |
| dmfrom | Direct materials | Enter the materials used in production, or work them out from raw materials purchases. |
| dm | Direct materials used | Raw materials that went into production this period. |
| rm0 | Raw materials at the start | Raw materials inventory at the start of the period. |
| pur | Raw materials purchased | Net purchases of raw materials during the period. |
| rm1 | Raw materials at the end | Raw materials inventory at the end of the period. |
| dl | Direct labor | Wages of the workers who make the product. |
| moh | Manufacturing overhead | Other factory costs: indirect materials and labor, factory rent, utilities and depreciation. |
| wip0 | Work in process at the start | Partly finished goods at the start. Optional. |
| wip1 | Work in process at the end | Partly finished goods at the end. Optional. |
| fg0 | Finished goods at the start | Finished goods inventory at the start, for cost of goods sold. Optional. |
| fg1 | Finished goods at the end | Finished goods inventory at the end, for cost of goods sold. Optional. |

## Outputs

| Key | Label | Description |
| --- | --- | --- |
| cogm | Cost of goods manufactured (COGM) | Total manufacturing costs + beginning work in process − ending work in process. |
| total | Total manufacturing costs | Direct materials used + direct labor + manufacturing overhead. |
| materialsUsed | Direct materials used | As entered, or raw materials at the start + purchases − raw materials at the end. |
| inProcess | Total cost of work in process | Beginning work in process + total manufacturing costs. |
| cogs | Cost of goods sold | Beginning finished goods + COGM − ending finished goods. Shown when you enter both. |

## Method

Direct materials used = raw materials at the start + purchases − raw materials at the end (or as entered). Total manufacturing costs = direct materials used + direct labor + manufacturing overhead. COGM = work in process at the start + total manufacturing costs − work in process at the end. Cost of goods sold = finished goods at the start + COGM − finished goods at the end.

## Assumptions

- All amounts are for the same period, from the factory’s records.
- Manufacturing overhead is the overhead charged to production in the period.
- Arithmetic is exact on the typed decimals; money shows to the cent, halves up.

## Worked examples

1. dmfrom = used, dm = $15,000.00, dl = $25,000.00, moh = $23,000.00, wip0 = $75,000.00, wip1 = $43,000.00, fg0 = $65,000.00, fg1 = $58,000.00 gives cogm = $95,000.00, total = $63,000.00, materialsUsed = $15,000.00, inProcess = $138,000.00, cogs = $102,000.00. Source: OpenStax, Principles of Managerial Accounting, 2.1 Distinguish between Merchandising, Manufacturing, and Service Organizations (schedule of cost of goods manufactured; Koeller Manufacturing). https://openstax.org/books/principles-managerial-accounting/pages/2-1-distinguish-between-merchandising-manufacturing-and-service-organizations: 15,000 + 25,000 + 23,000 = 63,000.
2. dmfrom = purchases, rm0 = $10,000.00, pur = $50,000.00, rm1 = $12,000.00, dl = $30,000.00, moh = $22,000.00, wip0 = $5,000.00, wip1 = $8,000.00 gives cogm = $97,000.00, total = $100,000.00, materialsUsed = $48,000.00, inProcess = $105,000.00. Source: OpenStax, Principles of Managerial Accounting, 2.1 Distinguish between Merchandising, Manufacturing, and Service Organizations (schedule of cost of goods manufactured; Koeller Manufacturing). https://openstax.org/books/principles-managerial-accounting/pages/2-1-distinguish-between-merchandising-manufacturing-and-service-organizations (direct materials used = beginning materials + purchases − ending materials).
3. dmfrom = used, dm = $12,500.50, dl = $8,000.25, moh = $4,100.75 gives cogm = $24,601.50, total = $24,601.50, inProcess = $24,601.50.

## FAQ

### What is cost of goods manufactured (COGM)?

COGM is the cost of the goods a factory finished during the period. It moves the cost of completed products out of work in process and into finished goods inventory, and it feeds the manufacturer's cost of goods sold.

### How do I calculate COGM?

Add direct materials used, direct labor and manufacturing overhead to get total manufacturing costs. Add the work in process at the start and subtract the work in process at the end. Koeller Manufacturing had $63,000 of manufacturing costs, $75,000 of work in process at the start and $43,000 at the end, so its COGM was $95,000.

### How do I find the direct materials used?

Add raw materials purchases to the raw materials inventory at the start, then subtract the raw materials inventory at the end. $10,000 at the start, $50,000 of purchases and $12,000 at the end means $48,000 of materials went into production.

### What is the difference between COGM and cost of goods sold?

COGM is the cost of goods finished; cost of goods sold (COGS) is the cost of goods sold to customers. COGS = finished goods at the start + COGM − finished goods at the end. Koeller had $65,000 of finished goods at the start and $58,000 at the end, so its COGS was 65,000 + 95,000 − 58,000 = $102,000.

### What is included in manufacturing overhead?

All factory costs other than direct materials and direct labor: indirect materials such as glue and screws, indirect labor such as supervisors and maintenance staff, factory rent, utilities, insurance and depreciation of factory equipment.

### Why adjust for work in process?

Some of this period’s manufacturing costs sit in products that are not finished yet, and some finished products were started last period. Adding the beginning work in process and subtracting the ending work in process leaves only the cost of goods completed this period.

## Sources

- OpenStax, Principles of Managerial Accounting, 2.1 Distinguish between Merchandising, Manufacturing, and Service Organizations: the schedule of cost of goods manufactured (beginning work in process + direct material + direct labor + manufacturing overhead − ending work in process), direct materials used (beginning materials inventory + net purchases − ending materials inventory) and cost of goods sold (beginning finished goods + COGM − ending finished goods); Koeller Manufacturing (COGM $95,000, cost of goods sold $102,000). https://openstax.org/books/principles-managerial-accounting/pages/2-1-distinguish-between-merchandising-manufacturing-and-service-organizations (retrieved 2026-10-19)