What is Selling, General and Administrative? SG&A Meaning & Definition

sg and a meaning

If the specific gravity has a value of greater than one, then the object sinks in water and if it is less than one, then the object floats in water. If the specific gravity has a value equal to one, then the object will neither sink nor float. The mass itself is directly related to the weight of an object, measured in units called Newtons.

sg and a meaning

A company incurs these expenses to generate sales and are directly related to the company’s sales activities. The selling component of this expense line is related to the direct and indirect costs of generating revenue (from selling products or services). SG&A is part of a company’s operating expenses, and some companies, especially smaller firms, use the terms SG&A and operating expenses interchangeably. However, U.S. accounting standards treat R&D as a separate operating expense that’s not part of SG&A. Depreciation is typically reported as a separate line item within operating expenses, too.

SG&A: Selling, General, Administrative Expenses – Definition and Explanation

The core function within CEA of a construct like the QALY is to serve as a common unit of value that incorporates both life extension and quality-of-life enhancement. Otherwise one is comparing apples and oranges and would not know what total value an array of diverse lifesaving and quality enhancing outcomes had. TTO and SG questions are appropriate precisely because they transparently involve a relationship between quality enhancement and longevity.

sg and a meaning

General expenses are essential for companies and investors, as they can impact a company’s profitability and efficiency. Companies with high available fees may not operate as efficiently as those with low overhead costs, which can negatively impact their bottom line. Companies with low available prices and efficient operations can generate higher profits.


A company incurs these expenses regardless of whether they generate or do not generate sales and are typically a significant component of a company’s operating expenses. General and Administrative (G&A) expenses are the day-to-day costs a business must pay to operate, whether or not it manufactures products or generates revenue. Typical G&A expenses include rent, utilities, insurance payments, and wages and salaries for administrative and management staff other than salespeople.

Company ABC’s total selling, general, and administrative expenses for the period is $8,600. Certain companies will file their financial statements with one line for SG&A, while others – for example, software companies – will separately break out G&A and sales & marketing. The SG&A ratio is simply the relationship Running Law Firm Bookkeeping: Consider the Industry Specifics in the Detailed Guide between SG&A and revenue – i.e. the expense expressed as a percentage of total sales. The calculation excludes interest expense since interest is reported as a “non-operating” expense (i.e. non-core). Likewise, the taxes paid to the government are also not included under the same rationale.

Density of a Substance

SG&A stands for “selling, general & administrative”, and is a catch-all category of expenses that is inclusive of spending that isn’t a direct cost, otherwise known as cost of goods sold (COGS). Our bookkeeping team completes your books and generates a monthly income statement and balance sheet for you. Bench’s easy-to-use software let’s you quickly see how your business is doing so you can make smarter decisions with your money and master your spending. They work with our client research team to get the answers you need to make informed decisions for your business strategy. For example, manufacturers range anywhere from 10% to 25% of sales, while in health care it isn’t unusual for SG&A costs to approach 50% of sales. It’s a broad “catch-all” category that basically includes anything you spend money on that isn’t a production cost, also known as cost of goods sold (COGS).

  • Selling expenses can be broken down into direct and indirect costs.
  • Skylar Clarine is a fact-checker and expert in personal finance with a range of experience including veterinary technology and film studies.
  • Selling, General, and Administrative expenses (SG&A) are the costs incurred by a company in its daily operations, excluding the costs of producing goods or services.
  • The objective of the cultural diversity (C) requirement is to promote awareness and appreciation of cultural diversity within the contemporary U.S.
  • SG&A expenses are sometimes referred to as period costs since they relate to the time period in which they are incurred, and they do not relate directly to production.
  • Overall, understanding SG&A expenses is an essential aspect of financial management and can help companies to make informed decisions and to achieve financial stability and growth.
  • This means that 26.65% of every dollar XYZ Inc. earns gets spent on SG&A expenses.

Let’s imagine that Julie the Jeweler wants to make a piece with a gold ring. She buys the gold online and wants to know for sure that it’s real, not a different metal that looks like gold. If the gold is genuine, then it should be denser than water — the density of gold is 19 g/mL and the density of water is one g/mL. The specific gravity will be greater than one, so the gold should sink in water and displace a specific volume of water based on the weight of the gold. When we go out in the summer to enjoy the pools and the rivers, we always have to make sure that all of our equipment and safety measures are working and in place. When we go to the river and get on our boats, we make sure the boat has no leaks and we have our safety vests on.