Is inventory the cost of all goods purchased or only those that have not sold?

[joanne-jah]

in other words, for my small business, do I count the cost of everything I bought to sell or only the cost of the items that sold?

[Coleen3]

Cost of goods sold is illustrated below. Be sure you entered the beginning and ending inventories. If you do not keep an inventory, these are probably supplies.

TurboTax Calculates Cost of Goods Sold as follows:

Beginning Inventory

+ Purchases                            

= Inventory Available For Sale

- Ending Inventory                   

= Cost of Goods Sold