The term “Cost of Goods Sold” refers to the direct cost incurred to sell the products by a business. It is also known as the “Cost of Sales”. It not only costs but also includes material, labor, and production-related expenses for the said product. However, the Cost of Goods Sold does not include some indirect costs such as operating expenses, marketing, and overhead costs. It is important to analyze what are the particular costs which have incurred related to the sale of the product.  For example, if a company is selling furniture, it is important to note of there has…