Hi
Selling expenses are those directly associated with the selling process. Administration expenses generally do not vary with Sales volume/value. Administration expenses tend usually to either represent fixed costs of "doing business", or have a broad application across many business functions.
If we take communications as an example, telephones are used by all parts of the business - internal communication, Sales, Production, Logistics, Admin, etc. Communications is therefore reported as an Admin expense (unless the costs can be directly attributed to each business unit, but lets not worry about that here).
Depreciation expense also defaults to Admin expenses, as it usually relates to assets employed in many/all functions of the business (again, it can be allocated to specific business units etc, but that is a choice of management).
Showroom equipment will presumably be capitalised to Fixed Assets, unless the individual unit values are low ($500 for tax purposes).
A point to note - do not confuse tax accounting with financial accounting. When studying, you should follow GAAP & NZIFRS, not tax rules.作者: outsider2009 时间: 2010-10-9 10:29:22