Gross Income is your total income
before any expenses, taxes, depreciation etc. is removed.
Cost of Goods Sold is whatever
you paid to buy or make the products you sell.
For example, if you run a company
that sell yoga mats, and you sell 100 yoga mats at $10 each, your Gross Income
would be $1000. If you paid $5 to buy each mat you sold, then your Cost of
Goods Sold would be $500.
If you don’t sell any products,
then you won’t have Inventory or a Cost of Goods Sold, you would just have
expenses.
