Landed cost is costs that according to GAAP should be part of cost of goods sold (CoGS).
CoGS can be divided into the following basic parts:
- The purchase price
- Customs fees or other fees related to the purchase
- Other handling fees
The purchase price is traditionally the "cost" of the product. However, for some products the other costs can be a big part of the cost for selling the goods. For these products it's important to track these other costs, so called landed costs.