What you’ll learn to do: Demonstrate proper financial statement presentation of inventory and cost of goods sold

So far, you’ve discovered that the single seemingly simple item called Inventory on the balance sheet can be quite complicated. In this section, you’ll learn how to present COGS on a multi-step income statement that shows the sub-total of gross profit (also called gross margin) and operating income, and how inventory errors can affect the bottom line, as well as the required disclosures related to inventory.