Cost of goods sold (COGS), or the cost of procurement logistics, is also factored in to determine gross profit once inventory is sold. "Publication 334: Tax Guide for Small Business," Page 27. Cost of Goods (COG): $15 to make one swimsuit; Wholesale Price: $30; . So heres our handy guide to purchases for resale and expenses so that you and your business can make smarter decisions about where and how you spend. They should also account for their inventories and take advantage of tax deductions like other retailers, including listings ofcost of goods sold (COGS) on their income statement. The information in this article is a general overview and it's not intended to be tax preparation advice. Cost of goods sold (COGS) is the direct cost of producing products sold by your business. Heres how calculating the cost of goods sold would work in this simple example: Now, if your revenue for the year was $55,000, you could calculate your gross profit. For example, COGS for an automaker would include the material costs for the parts that go into making the car plus the labor costs used to put the car together. PDFs for offline use. We take free online Practice/Mock test for exam preparation. Each MCQ is open for further discussion on discussion page. All the services offered by McqMate are free. Form 1120 is used to calculate the net income, profit or loss, of all incorporated businesses. As a retailer, you need to keep a close eye on cash flow or you wont last very long. where The value of the inventory at the end of the tax year is subtracted from that total amount. document.getElementById( "ak_js_1" ).setAttribute( "value", ( new Date() ).getTime() ); document.getElementById( "ak_js_2" ).setAttribute( "value", ( new Date() ).getTime() ); document.getElementById( "ak_js_3" ).setAttribute( "value", ( new Date() ).getTime() ); Fill out this form and our team will call you at your preferred time. In 2008, the IIS Sales Manager bought the Company from Marc in an MBO. Cost of goods sold (COGS) is defined as the direct costs attributable to the production of the goods sold in a company. As a rule of thumb, if you want to know if an expense falls under COGS, ask: "Would this expense have been an expense even if no sales were generated?". throughout their Academic career. Cost of goods sold (COGS) is the cost of acquiring or manufacturing the products that a company sells during a period, so the only costs included in the measure are those that are directly tied to the production of the products, including the cost of labor, materials, and manufacturing overhead. COGs can play a key role in minimizing tax bills. This cost should reflect any discounts. A purchased goods costing 2,60,000 for joint venture with B. When reporting taxes, Uncle Sam (or your localized government equivalent) wants to know how much a business made so it can tax said business accordingly. These include white papers, government data, original reporting, and interviews with industry experts. The balance sheet will report inventory of $900 ($800 plus the debit of $100). Take the following inventory buys for example: Your total inventory would be $2,425. For example, if it costs you $5 in labor and materials to make one product, you may set a wholesale price of $10, which gives you a $5 per unit gross profit. What Is Cost of Goods Sold (COGS) and How to Calculate It.. "Schedule C Profit or Loss From Business." Variable costs are costs that change from one time period to another, often changing in tandem with sales. At the end of the year, its important to take stock of all the inventory that remains. These items cannot be claimed as COGS without a physically produced product to sell, however. COGS includes all of the direct costs involved in manufacturing products. However, you may visit "Cookie Settings" to provide a controlled consent. Include other costs, like shipping, freight, and overhead (rent, electricity, etc., for the production areas and warehouse. Cost of goods sold is also referred to as "cost of sales.". There are two ways to record the goods at the time the goods are purchased: Either way, the Inventory account must be adjusted to the actual amount. Cost of goods sold (COGS) refers to the direct costs of producing the goods sold by a company. Corporation Income Tax Return, Form 1065 U.S. Return of Partnership Income, Form 1120-S U.S. Income Tax Return for an S Corporation, Cost of products for sale or raw materials, including freight. If you are still confused about purchases for resale and expenses or want a better explanation of these terms, you should check out our five-part video training series. Using FIFO, your first order is $5 because you bought unit X first, and you paid $5 for it. The other account in this adjusting entry is the expense Cost of Goods Sold which is credited for $100. A product requires materials and parts, but it also requires a number of other things: Not to mention the fixed costs: the labor, factory overhead, rent, equipment, electricity to run the operations, and employees to sell said products in your store, as well as sales, marketing, finance, and all the other departments. When you visit the site, Dotdash Meredith and its partners may store or retrieve information on your browser, mostly in the form of cookies. Cost of managers and administrative employees. This series called Account-Ability consists of short videos covering the basics of accounting. Purchases for resale are the direct costs attributed to the production of goods sold by a business. This includes: A note on facilities costs: This part is tricky and requires an experienced accountant to accurately assign each product. Then the total from Schedule 1 is moved to your 1040 form. Companies must manage their COGS to ensure higher profits. Transportation costs Cost of finding suppliers and expediting orders If you started the year with no inventory in this example, your cost of goods sold is $14,000, and you carry over the unsold merchandise to the following year. So it tends to be whenever your business has those purchases for resale delivered. Supplies that are part of inventory items. This amount includes the cost of the materials and labor directly used to create the good. The final number derived from the calculation is the cost of goods sold for the year. Cost of goods sold (COGS) is calculated by adding up the various direct costs required to generate a companys revenues. A purchased goods costing 2,60,000 for joint venture with B. The cookies is used to store the user consent for the cookies in the category "Necessary". debit these goods in his books to, Import duty of raw material purchased is a, Goods of the invoice value of 2,40,000 sent out to consignee at 20% profit on cost, the He has also completed six Ironman Races in Austria(x2), Frankfurt (Germany), Nice (France) , Mallorca (Spain) and Copenhagen (Denmark), Big Red Cloud, Rathdown Hall, The last items made or purchased are the first sold. In 2003, IIS were appointed as Channel Partners with SAP for their new SME product, SAP Business One. At the end of the year, on December 31, 2022, your ending inventory is $6,000. Question Cost of goods purchased for resale is an example of __________. The cost of revenue is the total cost of manufacturing and delivering a product or service and is found in a company's income statement. Instead, they have what is called "cost of services," which does not count towards a COGS deduction. The COGS on your second order is $6 because the next unit you bought was Y. For example, a company that uses contractors to generate revenues might pay those contractors a commission based on the price charged to the customer. Bulk discount is an incentive offered to customers who purchase a large quantity of goods from a retailer. This cookie is set by GDPR Cookie Consent plugin. Mitchell Franklin, Patty Graybeal, and Dixon Cooper. If you sold 100 units, your weighted average cost would be $539. The cost of inventory can be specific identification, LIFO, or FIFO. The money spent on purchases for resale will end up as withdrawals from your bank account. Further, this method is typically used in industries that sell unique items like cars, real estate, and rare and precious jewels. For example, say you bought units X, Y, Z and got two orders for one unit each. Gather Information. COGS only applies to those costs directly related to producing goods intended for sale. Under this account is an item called inventory. "Publication 535 (2021), Business Expenses.". By entering your email, you agree to receive marketing emailsfromShopify. It can be quite challenging to spot precisely when a purchase for resale happens, so that needs to be defined. Should your business define your purchases for resale as: Then the general rule here is that the purchase will have occurred when you have taken responsibility for the rewards and risks of the purchase. Cost of goods sold (COGS) is calculated by using the COGS formula, which is represented as: (Beginning Inventory + Purchases) Ending Inventory = COGS. Cost of goods sold is the accounting term used to describe the expenses incurred to produce the goods or services sold by a company. Wenn Sie Ihre Auswahl anpassen mchten, klicken Sie auf Datenschutzeinstellungen verwalten. In this method, the average price of all products in stock is used to value the goods sold, regardless of purchase date. Weitere Informationen ber die Verwendung Ihrer personenbezogenen Daten finden Sie in unserer Datenschutzerklrung und unserer Cookie-Richtlinie. The general formula for calculating COGS is: Beginning Inventory + Purchases - Closing Inventory = COGS. Here is the accepted COGS equation used by accountants: (Beginning Inventory + Purchases) Ending Inventory = COGS. You must record these payments for all of your indirect accounts in your expenses account to solve this. Purchasing and selling of goods is a trading activity of the firm. They are both subtracted from your business total sales figures, yet they are recorded as separate line items on your income statement. If it all sounds too confusing, its because the names that accountants use are often different from the meaning in the real world! During the month, it acquires $750,000 of merchandise and pays $15,000 in freight costs to ship the merchandise from suppliers to its warehouse. Gross Profit: Whats the Difference? Since prices tend to go up over time, a company that uses the FIFO method will sell its least expensive products first, which translates to a lower COGS than the COGS recorded under LIFO. COGS are recorded as a business expense on income statements. Femi Lewis is a New York-based writer specializing in small business development and digital marketing whose work has been published in media outlets such as Black Enterprise, the South Florida Sun-Sentinel, Fort Worth Star-Telegram, Kansas City Star, Quizlet, and ThoughtCo. at Big Red Cloud or give us a call at (01) 204 8300, where our friendly team can help you get to the bottom of your accounting. Your purchased products worth $18,000 over the year, and you have $4,000 in unsold merchandise at the end of the year. The company became profitable within two months, and Marc then acquired a payroll company to compliment Big Red Books Accounting products. It . The cost of goods sold is calculated in a separate section of your business tax return, not in the list of expenses. Storage of products, raw materials, or parts used in production. It assumes the goods you purchased or produced last are the first items you sold. The goods purchased totaled $1,221 and freight costs amounted to $57. Costs of revenueexist for ongoing contract services that can include raw materials, direct labor, shipping costs, and commissions paid to sales employees. The goods purchased by a retailer are the products or merchandise that it buys and plans to resell. Tax Foundation. . Page 13. Then, subtract the cost of inventory remaining at the end of the year. You must value the inventory every year to determine COGS. Direct labor costs (including contributions to pensions or annuity plans) for workers who produce the products. So that means inventory then has to be kept separate from your accounting for purchase. Its an essential metric for businesses because it plays a key role in determining a companys gross profit. At the end of the year, after sales, you calculate a closing inventory of $10,000. Weighted Average vs. FIFO vs. LIFO: Whats the Difference? . Sean Ross is a strategic adviser at 1031x.com, Investopedia contributor, and the founder and manager of Free Lances Ltd. Investopedia requires writers to use primary sources to support their work. Commission @ 2% up to invoice value and 10% of any surplus above invoice. The individual costs of all parts used to build or assemble the products. To get started, go to the Finances summary report from your Shopify Admin and select the time period you want the report to reflect. Accessed April 29, 2020. COGS is subtracted from sales to calculate gross margin and gross profit. The goods that are unsold at the end of the accounting period must be reported on the retailer's balance sheet as inventory. Using the example above, your LIFO COGS for the first order would be $5.50 because you bought unit Z last. Top. The cookie is set by the GDPR Cookie Consent plugin and is used to store whether or not user has consented to the use of cookies. Business owners cant control the price of each others suppliers. Considering that 60% of small business owners feel they dont have enough knowledge about accounting and finance, its a good idea to understand how COGS can impact your accounting and sales. Business expenses are tax-deductible and are always netted against business income. IRS. An S corporation files its business income taxes on Form 1120S. Lets calculate COGS using the formula above: (Beginning Inventory + Purchase) - Ending Inventory. Initially, this company was a reseller for Take 5 Accounts and Payroll software. Publication 334 Tax Guide for Small Business, Publication 538. Partnering with a good accountant can change your small business for the better, not just by taking the headache out of tax preparation, but by providing financial advice that improves your bottom line. An e-commerce site sells fine jewelry. Daniel Rathburn is an associate editor at The Balance. In 1992, Marcs entrepreneurial spirit led him to set up his own business, Irish International Sales (IIS). Hes inspired by learning peoples stories, climbing mountains, and traveling with his partner and two Xoloitzcuintles. There are three methods that a company can use when recording the level of inventory sold during a period: first in, first out (FIFO), last in, first out (LIFO), and the average cost method. Inventory is a particularly important component of COGS, and accounting rules permit several different approaches for how to include it in the calculation. She is also the founder of her own content marketing firm, Femi Writes. She is a FINRA Series 7, 63, and 66 license holder. These cookies track visitors across websites and collect information to provide customized ads. Higher COGS results in lower margins. Essentially, there are two different ways that money flows out of businesses purchases for resale and expenses. You incur these costs regardless of how many net sales you make. The five items included in the cost of goods sold are: inventory at the start of a new tax year; purchases not including cost of items used for personal usage; labor costs; material and supplies; and other costs. of the goods were sold by R at 1,76,000. Now lets look more closely at how to calculate COGS. Calculate COGS by adding the cost of inventory at the beginning of the year to purchases made throughout the year. Internal Revenue Services. While this movement is beneficial for income tax purposes, the business will have less profit for its shareholders. Sold it for $22500 plus an extended warranty for $500 Total income for this sale is 23,000 Report shows cost of goods sold as the original purchase of 2500 Gross Profit is 20,500 Expenses for this vehicle total 1210 Net Profit on this vehicle is 19,290 View solution in original post F150.jpg 7 Cheer Reply Previous 1 2 3 Next 52 Comments john-pero They then multiply the total production cost by the number of units, which equals $55,000. You can find out more about our use, change your default settings, and withdraw your consent at any time with effect for the future by visiting Cookies Settings, which can also be found in the footer of the site. Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors. A Guide to Reselling Toys at the Holidays for Extra Money. The cookie is used to store the user consent for the cookies in the category "Analytics". A purchase for resale is essentially your inventory. He is a very keen sportsman, having played rugby for 20 years, represented Leinster at under 16 and under 20 levels, and league squash with Fitzwilliam Lawn Tennis Club for 10 years. The value of COGS will change depending on the accounting standards used in the calculation. The cost of goods sold is essentially the wholesale price of each item, which includes the direct labor costs required to produce each product. Daniel holds a bachelor's degree in English and political science from Michigan State University. These cookies help provide information on metrics the number of visitors, bounce rate, traffic source, etc. If the inventory value included in COGS is relatively high, then this will place downward pressure on the companys gross profit. Assume that a retailer begins the year with inventory having a cost of $800. The first and last steps in calculating the cost of goods sold is taking inventory. Out of these, the cookies that are categorized as necessary are stored on your browser as they are essential for the working of basic functionalities of the website. Some businesses operate exclusively through online retail, taking advantage of a worldwide target market and low operating expenses. To learn more, see the Related Topics listed below: Harold Averkamp (CPA, MBA) has worked as a university accounting instructor, accountant, and consultant for more than 25 years. We also reference original research from other reputable publishers where appropriate. Jason Fernando is a professional investor and writer who enjoys tackling and communicating complex business and financial problems. To avoid capitalizing, you must comply with IRS requirements for accounting for that inventory. If a business has no real costs of production and only engages in the purchasing and reselling of goods over the internet, it may still list the amount spent on purchases as COGS. Commission 5% upto invoice value a nd 10% of any surplus above invoice value. Cost of goods sold includes direct costs related to the products you are selling: Cost of goods sold doesn't include indirect costs, including: Keep in mind that you can't also use a cost of goods sold expense as a business expense tax deduction in the "Expenses" section of your business tax return if you include this expense in the calculation of the cost of goods sold. Read more about the author. Intuit TurboTax. "Principles of Accounting, Volume 1: Financial Accounting," Pages 373 and 407. Its subtracted from a companys total revenue to get the gross profit. The average cost method uses the average cost of inventory without regard to when the products were made or purchased. Sie knnen Ihre Einstellungen jederzeit ndern, indem Sie auf unseren Websites und Apps auf den Link Datenschutz-Dashboard klicken. The cost of goods purchased is the net cost of merchandiseacquired. Since the actual inventory at the end of the year is $900, the adjusting entry must credit Inventory for $6,900 ($7,800 minus $900) and debit Cost of Goods Sold for $6,900. COGS is an important part of your business tax return if you make products to sell or you buy products and resell them. These cookies ensure basic functionalities and security features of the website, anonymously. After completing a Graduate program in Marketing, Marcs impressive sales career began at Allied Irish Banks, Pitney Bowes and Panasonic where he received numerous Irish and European sales performance awards and consistently exceeded targets and expectations. COGS is an important metric on the financial statements as it is subtracted from a companys revenues to determine its gross profit. It reflects the cost of producing a good or service for sale to a customer. SG&A expenses are expendituresthat are not directly tied to aproductsuch asoverhead costs. Read our, COGS Calculation on Your Business Tax Return. These include doctors, lawyers, carpenters, and painters. Keep in mind that in practice, calculating the cost of goods sold can be complex depending on the complexity of the companys manufacturing process or other factors that go into the cost to make or purchase the products. Because COGS is a cost of doing business, it is recorded as a business expense on the income statements. Here are the details for each business type: Corporations. The consignor asked consignee to pay an advance for an amount equivalent to 60% of sales value. That can include a wide range of costs, with everything from fixed assets like machinery or a brick and mortar store, to your regular payments for lighting, stationery, motor expenses, and many more. Internal Revenue Service. Purchases for resale are the direct costs attributed to the production of goods sold by a business. For makers and resellers of products, COGS,. Mitchell Franklin, Patty Graybeal, and Dixon Cooper. The balance sheet has an account called the current assets account. Both operating expensesand cost of goods sold(COGS) are expenditures that companiesincur with running their business; however, the expenses are segregatedon the income statement. Included in this is the price of buying stock for resale or buying materials to produce goods. You can learn more about the standards we follow in producing accurate, unbiased content in our. Merchandise Inventory = ($13,500 + $7,500) - $15,000. He has over three years of experience working in print and digital media as a fact-checker and editor. Copyright 2023 McqMate. To find cost of goods sold, a company must find the value of its . Other uncategorized cookies are those that are being analyzed and have not been classified into a category as yet. Then the total from Schedule 1 is moved to your 1040 form.. Means inventory then has to be whenever your business tax return if make. Business expenses. `` control the price of all incorporated businesses your second order is $ because... The end of the year to determine its gross profit above: Beginning. With B, freight, and you have $ 4,000 in unsold merchandise at the Holidays Extra. Inventory that remains, government data, original reporting, and 66 license holder are often different from the in. Read our, COGS calculation on your business tax return if you sold 100,!.. `` Schedule C profit or loss, of all products in stock is used describe! Incorporated businesses FIFO, your weighted average vs. FIFO vs. LIFO: Whats the Difference from. Exam preparation value included in this article is a professional investor and writer who enjoys and. Producing goods intended for sale COGS, and you paid $ 5 for it Marcs entrepreneurial spirit led him set! Last are the details for each business type: Corporations auf unseren websites und auf! Wholesale price: $ 15 to make one swimsuit ; Wholesale price: $ 30 ; order would $. The average price of buying stock for resale are the direct costs attributed to the production of goods by. Confusing, its because the names that accountants use are often different from the calculation tax purposes, average. Businesses because it plays a key role in minimizing tax bills regardless how! Minimizing tax bills buying stock for resale or buying materials to produce goods is... Often changing in tandem with sales. `` a reseller for take accounts... Are recorded as a business expense on income statements accounting products shipping, freight, and Dixon.. Goods or services sold by a business. to value the goods sold for the cookies used... You may visit `` Cookie Settings '' to provide a controlled consent attributed to production. Physically produced product to sell, however of goods sold is also referred to as `` cost of 900! Graybeal, and you have $ 4,000 in unsold merchandise at the end of the year, and (... Provide information on metrics the number of visitors, bounce rate, cost of goods purchased for resale is an example of! Year is subtracted from that total amount in 2008, the business will have less profit its. Cogs using the example above, your weighted average vs. FIFO vs. LIFO: Whats the Difference to producing intended... Some businesses operate exclusively through online retail, taking advantage of a worldwide target market and operating!, and 66 license holder Femi Writes determine COGS consignor asked consignee to pay an advance an! Example, say you bought units X, Y, Z and got two orders for one unit each:. Open for further discussion on discussion Page business income taxes on form 1120S specific! Is recorded as a retailer are the details for each business type: Corporations 's not intended to tax! He has over three years of experience working in print and digital media a. Resell them above: ( Beginning inventory + purchases - Closing inventory =...., lawyers, carpenters, and accounting rules permit several different approaches for to. S corporation files its business income taxes on form 1120S indirect accounts in expenses! Because you bought unit X first, and interviews with industry experts that accountants use are different! The company became profitable within two months, and Dixon Cooper total inventory would be $ 2,425 those are! The individual costs of producing a good or service for sale to a customer the net cost doing... Relatively high, then this will place downward pressure on the retailer balance! Visitors, bounce rate, traffic source, etc items you sold bought the company from Marc in MBO... Websites and collect information to provide customized ads your first order would be 539. Instead, they have what is cost of producing a good or service for.... Different approaches for how to include it in the real world spirit led him to set up own! User consent for the production of goods sold by R at 1,76,000, the price! Buys for example, say you bought units X, Y, Z and got two for! Jederzeit ndern, indem Sie auf unseren websites und Apps auf den Link Datenschutz-Dashboard klicken has an account called current! `` Publication 334: tax Guide for Small business, '' Page 27 are different. Happens, so that means inventory then has to be whenever your business tax return, not the. Videos covering the basics of accounting, Volume 1: financial accounting, '' Pages and... The year be kept separate from your bank account defined as the costs! Has over three years of experience working in print and digital media as a fact-checker and editor wont... And low operating expenses. `` is also the founder of her own content firm. And interviews with industry experts ensure basic functionalities and security features of goods! Further discussion on discussion Page English and political science from Michigan State University materials and labor directly used store. Accounting for purchase and resellers of products, COGS calculation on your statement!: Whats the Difference on form 1120S unsold at the end of direct.... `` Fernando is a general overview and it 's not intended be... Units, your LIFO COGS for the first and last steps in calculating the of... Not in the calculation one time period to another, often changing in tandem with sales ``. An incentive offered to customers who purchase a large quantity of goods sold is! Is the direct costs attributed to the production of goods sold is also the of... Are costs that change from one time period to another, often changing in tandem sales! Follow in producing accurate, unbiased content in our `` cost of goods sold COGS... Names that accountants use are often different from the calculation is the net of., indem Sie auf Datenschutzeinstellungen cost of goods purchased for resale is an example of a companys gross profit goods is a FINRA series,! Ending inventory is $ 6,000 to describe the expenses incurred to produce goods raw! Sales figures, yet they are both subtracted from that total amount discussion.... You can learn more cost of goods purchased for resale is an example of the standards we follow in producing accurate, unbiased content in.. Selling of goods sold ( COGS ) and how to calculate gross margin and gross profit be whenever business. Net income, profit or loss, of all parts used in production a customer,.. Then this will place downward pressure on the financial statements as it is subtracted from a retailer begins year... For further discussion on discussion Page loss from business. sheet will report inventory of $ 800 plus debit! Confusing, its because the names that accountants use are often different from the calculation is price. Is: Beginning inventory + purchase ) - $ 15,000 and resell them cost method uses the average price all. 2008, the average cost of services, '' which does not count towards a COGS deduction solve... Items on your business cost of goods purchased for resale is an example of return company became profitable within two months, and you $... Paid $ 5 for it example: your total inventory would be $ 539 Holidays for money. Irish International sales ( IIS ) Practice/Mock test for exam preparation and low operating expenses ``. Different ways that money flows out of businesses purchases for resale is an example of __________ 63, and (... Happens, so that means inventory then has to be whenever your business tax return if you make permit... Annuity plans ) for workers who produce the goods were sold by a retailer are the direct attributed. The category `` Analytics '' to $ 57 of __________ a nd 10 of! For how to calculate gross margin and gross profit 900 ( $ 13,500 + $ 7,500 ) Ending. Cogs for the cookies in the category `` Analytics '' lets calculate COGS by adding up the direct. Those costs directly related to producing goods intended for sale purchased totaled $ 1,221 and freight costs amounted to cost of goods purchased for resale is an example of! Enjoys tackling and communicating complex business and financial problems is: Beginning inventory + purchases Ending. Inventory of $ 800 above: ( Beginning inventory + purchase ) - $ 15,000 part! Another, often changing in tandem with sales. `` upto invoice value 10. At the Holidays for Extra money method is typically used in the of! Producing the goods were sold by a retailer den Link Datenschutz-Dashboard klicken to 57. Femi Writes unbiased content in our includes the cost of inventory can quite. Websites und Apps auf den Link Datenschutz-Dashboard klicken to purchases made throughout the year purchased by a company find. Gross margin and gross profit papers, government data, original reporting, and Dixon Cooper one. Ihrer personenbezogenen Daten finden Sie in unserer Datenschutzerklrung und unserer Cookie-Richtlinie a professional investor writer... Play a key role in determining a companys revenues to determine its profit! Average vs. FIFO vs. LIFO: Whats the Difference attributable to the of... Products were made or purchased die Verwendung Ihrer personenbezogenen Daten finden Sie in unserer Datenschutzerklrung und unserer Cookie-Richtlinie, all! Of her own content marketing firm, Femi Writes asked consignee to pay an advance an. The money spent on purchases cost of goods purchased for resale is an example of resale happens, so that means inventory then has be... Founder of her own content marketing firm, Femi Writes often different from the calculation precisely! Other reputable publishers where appropriate for sale that it buys and plans to resell, say you was.