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Former Member
Aug 04, 2009 at 07:59 AM

How do you close Cost of goods sold account?


Hi evrybody,

I have an accounting issue regarding the accounting of Cost of Goods sold account. When I close a production order I have to Debit account Finished goods and have to Credit account Cost of Goods sold. Is this correct? All the Expense accounts are closed to account Profit and Loss at the end of the period. Is this correct? How do you close an account Cost of Goods sold? This is still an expense account. And it should be closed at the end of the period. It has Credit balance at the end of the period.

Thank you very much!