I am willing to listen to Pochahontas since she might talk my language better than the Englander.  When I do an income statement, COGS kinda takes into account beginning and ending inventory, so I'm not sure what kind of income statement skips those facts.  But then again, I learned my accounting skills from accounting classrooms not a lab.  Although I guess if you are in a lab, you have the ability to create an accounting Frankenstein which sounds like what you end up with when you have inventory discrepancies.