What would be direct cost of sales in respect to COGS?

Question

I'm am putting together a business plan and it calls for direct cost of sales. I have in quickbooks COGS. Is there a difference?

Thanks

Answer 1

DIRECT cost of goods sold are the costs that are directly associated with the product being sold. This includes the component materials used to make the product, and the labor to put it together. When you add in the indirect manufacturing costs such as utilities, supervisory labor and other expenses not directly associated with the product you get TOTAL cost of goods sold.