Cost of goods sold is calculated as :

The correct answer is option 2- Sales – Gross profit.

Cost of Goods Sold (COGS) is an accounting term used to measure the direct expenses associated with the production of goods or services that a company sells during a specific period. It is often found in the company's income statement (also known as the statement of profit and loss or P&L statement).

The cost of revenue from operations is also called as Cost of Goods Sold and it means revenue from operations less gross profit or (Sales- gross profit).