Indian Accounting Standard (lnd AS) 1 and Schedule lll (Division ll) to the Companies Act (2013) mandate that Indian firms should report expenses in the Income Statement by ‘nature’ (for example, raw material consumed, employee costs, etc.). This contrasts with the reporting of expenses by ‘function’ (for example, manufacturing, selling, etc.) that is done by several companies in the United States. While the first method gives useful information to the users of the financial statements, it fails to clearly indicate the efficiency of the manufacturing function in a firm in terms of gross profits, which is the difference between revenues and manufacturing costs i.e. cost of goods sold (COGS). This exercise explains how to calculate COGS and gross profits for an Indian manufacturing company—Dabur India Limited, using the information given in the annual report. The process of calculation leads to interesting debates on what the right number should be. The discussion also critically analyses a voluntary disclosure on COGS by the company.