What's the Difference Between Selling, General, And Administrative Expenses and Operating Expenses? This will help ensure that the company's bottom line is not unduly affected by these costs. In order to ensure that a company's net income is as accurate as possible, it is important to accurately track and report SG&A expenses. Professional fees, such as accounting or legal fees Salaries and benefits for administrative staff Some common examples of SG&A expenses include: SG&A expenses are those that are incurred in the course of normal business operations, but are not directly related to the production of a good or service. What Are Some Examples of Selling, General, And Administrative Expenses? This will give you the total cost of that particular expense.įor example, if a company spends $1,000 on advertising and marketing in a given month, and they produce and sell 10,000 units in that month, the total cost of advertising and marketing would be $10,000. Then, multiply this cost per unit by the number of units produced or sold. This is simply the cost of the good or service divided by the number of units produced or sold. To calculate any of these individual expenses, first determine the cost per unit. There are a number of different types of SG&A expenses, but some of the most common ones include salaries and wages, advertising and marketing, office supplies, and rent. The total amount of SG&A for a given period is the sum of all the individual expenses that comprise that category. The calculation of selling, general, and administrative expenses (SG&A) is a relatively straightforward process. How Do You Calculate Selling, General, And Administrative Expenses? SG&A expenses can be a significant expense for a company, and it is important to track them carefully in order to understand how they are impacting the company's profitability. It also includes general administrative costs, such as the costs of maintaining a corporate headquarters, paying for accounting and legal services, and providing employee benefits. This includes marketing and advertising costs, as well as the costs of any sales personnel. SG&A expenses are the costs a company incurs in order to sell its products and services. What Are Selling, General, And Administrative Expenses?
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |