What is the effect of decreasing ending inventory on COGS?
What is the effect of decreasing ending inventory on COGS?
سی او جی ایس پر ختم ہونے والی انوینٹری میں کمی کا کیا اثر ہے؟
Explanation
Decreasing ending inventory means that more inventory has been sold, which increases the Cost of Goods Sold (COGS).
As a result, COGS increases, and gross profit decreases.
This is because the cost of the inventory that has been sold is transferred from inventory to COGS.