cost of goods manufactured

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The total production cost of the finished goods transferred from the production facility of an organization during an accounting period. It is made up of the total expenditure for the period on direct materials, direct labour, direct expenses, and manufacturing overheads adjusted by the opening and closing stocks of raw materials and the work in progress at the beginning and end of the period. The cost of goods manufactured is often computed in the manufacturing account or in a cost of goods manufactured statement for a period.

Subjects: Accounting.

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