Analysis of Comparative Cost of Goods Sold Using Traditional Methods and Full Costing Methods at UMKM JLO Bone Regency

Abstract

This study aims to analyze the comparison of cost of goods sold (COGS) calculations using the traditional method versus the full costing method at UMKM JLO in Bone Regency. The research problem stems from the inaccuracy of COGS calculation by many MSMEs, which often only include direct costs and ignore indirect costs, leading to selling prices that do not reflect actual production costs. This research is qualitative with a descriptive approach, using data collection techniques through interviews, observation, and documentation. The results show that the traditional COGS calculation only includes raw material and direct labor costs. In contrast, the full costing method includes all production cost components, both direct and indirect (fixed and variable), such as electricity, equipment depreciation, and packaging. The full costing calculation yields a higher but more accurate COGS value, reflecting the true total production costs. Applying this method helps MSMEs set fair and competitive selling prices and supports financial transparency, which aligns with the principles of justice in Islamic economics.