Some Key Formulas
Cost of Goods Sold = Starting Inventory + Purchases - Ending Inventory
Food Cost % of Sales = (COGS by Category Type) / (Sales by Category Type)
Sales = All Sales Lines set to a Category Type AND Included in Reporting
What are the Different Reports in MarginEdge?
Controllable P&L - A high level view, showing you your COGS (Cost of Goods Sold) by Category Type. It is revenue and expenses gathered from sales entries, invoices, and inventory adjustments in a customizable date range.
Budgets - Shows you all purchases and inventory adjustments set by Category, compared with sales set with the same Category Type (i.e. a percentage budget) in a customizable date range. There is no way to exclude the inventory adjustments from your Budget reporting if you are recording them in MarginEdge.
Food Usage Report - Uses purchasing data, inventory summaries and sales entries to calculate Cost of Goods Sold and Cost % based on Category Type sales. Can adjust the view to see a timeframe between any two inventories (and is most meaningful if the chosen inventory dates actually have comparable inventories).
In other words, it gets you down to the product level COGS and cost percentages.
[Exportable as either a PDF or CSV, which means you can play with the data!]
Category Report - The category report shows you your purchases in a selected date range broken down by vendor, invoice and category (or GL account). Keep in mind the Category report shows purchases ONLY, so if you take inventory your Cost of Goods Sold will differ from this report which only shows purchases.
Frequently Asked Questions
Why don't my P&L and Food Usage Report match?
The Food Usage Report and the Inventory Summary may sometimes vary somewhat from the P&L when reporting Cost of Goods Sold even when looking at the same date range. This is because the Food Usage Report/Inventory Summary only include inventory data from the starting and ending inventory dates selected in their calculation but the P&L will calculate your starting value for each product based on the last inventory count before the selected date range. Usually these are the same, but if you have no counts for a product on the last inventory before the date range selected, the P&L won't report the starting value as $0 if there is an earlier count it can find to use.
Why don’t my Budgets and P&L match?
The Controllable P&L references different data than your Budgets.
- The Controllable P&L uses product category data as it is currently set in the system (which may not match every single closed invoice if anything changed recently).
- Budgets reference product category data as it is on the closed invoices.
This means if a product's category changed after an invoice was closed it will be reflected on the P&L in the new category but not in your budgets.
Why don’t my Budgets match my purchases?
Budgets are a reflection of your COGS, and your purchases are not the only factor in your cost of goods. You also need to consider your inventory.
When inventories are taken, the cost of goods value shifts because inventory on hand is not a cost of goods sold (an expense) but is a good available for sale (an asset). This means inventory adjustments where the value of the inventory goes up will commensurately decrease the Cost of Goods Sold. Likewise, an inventory adjustment where the inventory value goes down will will commensurately increase the Cost of Goods Sold.
Do I need to do PMIX Mapping to calculate my COGS?
PMIX mapping, or the mapping of your Products and/or Recipes to the buttons from your Point of Sale System is not necessary (or considered) when calculating your Cost of Goods Sold.