Selling, general, and administrative expense: Costs that are expensed as they occur and are not assets (not capitalized)

  • Costs expensed on the income statement in the period in which they occur (not added to inventory)
  • Selling: Costs not in cost of goods sold, such as commissions
  • General: Expenses such as taxes and miscellaneous costs
  • Administrative: General support and salaries not directly related to manufacturing


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