Translation: SG&A Expenses = Selling, General & Administrative Expenses.

SG&A (Selling, General & Administrative)

Simplified Definition: They are "company operating costs," such as CEO salaries, accountants, office rent, and advertising campaigns.

What Does It Mean for You?

  • Administrative Waste: Companies that inflate this line item often suffer from "bureaucracy" and excess administrative costs that do not directly benefit the product.

Common Question: Why are they sometimes combined with production costs?

  • Answer: This is where "accounting deception" sometimes occurs to hide the size of administrative expenses and make the product appear as if its cost is everything.