Difference Between Operating Expenses And Cost of Goods Sold
Operating Expenses are t hose expe nses w hich are i ncurred in t he daily operatio ns of t he b usi ness and such expe nses are not related to t he cost of productio n . Re nt Expenses , Telepho ne Expenses , Office Supplies Expenses , Selling And Marketing Expenses , Administrative Expenses, etc. are t he examples. Cost of Goods Sold is related to the cost of productio n in order to produce goods or products in order to sold t h ese to end customers. It is t he direct cost i ncurred to earn direct revenue for t he b usi ness. For example, a company manufactures tab les, the n all the releva nt costs i ncurred in producing tab les are added i n order to calculate t h e cost of goods sold for t he period.