When looking at the COGS on the P&L statement, what are some examples of variable costs?

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COGS is Cost of Goods Sold and the P&L is the Profit and Loss statement. It's important to know the acronyms as well as what's on the documents they indicate.

Variable costs are expenses incurred based on the production volume. Examples of common variable costs include raw materials, packaging, and labor directly involved in a company's manufacturing process.

"Variable costs that go into making the final product and determines the cost of goods sold would be things like direct labor, indirect labor, parts, and overhead. All these costs will be listed on the profit and loss statement."

"On the variable costs located on the Profit and Loss statement, the cost of goods sold refers to the finished product. The variables included in that finished product are raw materials, packaging, and labor ."

"The variable costs include things like direct labor, inventory or raw materials, sales and commissions as well as overhead. Basically everything that goes into making the product. This is all important to note because if you don't account for everything included in the work-in-progress inventory, then you'll be short of inventory in the long run."

Anonymous Answer

"Materials and labor."

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You can start with a direct answer such as this, and if the interviewer pauses, you can go into more detail or discussion on this topic.

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How to Answer: When looking at the COGS on the P&L statement, what are some examples of variable costs?

Advice and answer examples written specifically for an Accounting job interview.

12. When looking at the COGS on the P&L statement, what are some examples of variable costs?

How to Answer

COGS is Cost of Goods Sold and the P&L is the Profit and Loss statement. It's important to know the acronyms as well as what's on the documents they indicate.

Variable costs are expenses incurred based on the production volume. Examples of common variable costs include raw materials, packaging, and labor directly involved in a company's manufacturing process.

Written by Bobbi Witt on January 8th, 2021

Entry Level

"Variable costs that go into making the final product and determines the cost of goods sold would be things like direct labor, indirect labor, parts, and overhead. All these costs will be listed on the profit and loss statement."

Written by Bobbi Witt on January 8th, 2021

Answer Example

"On the variable costs located on the Profit and Loss statement, the cost of goods sold refers to the finished product. The variables included in that finished product are raw materials, packaging, and labor ."

Written by Bobbi Witt on January 8th, 2021

Experience

"The variable costs include things like direct labor, inventory or raw materials, sales and commissions as well as overhead. Basically everything that goes into making the product. This is all important to note because if you don't account for everything included in the work-in-progress inventory, then you'll be short of inventory in the long run."

Written by Bobbi Witt on January 8th, 2021