The Income Statement-Read and Use|video|hindi

 The Income Statement- Selling, General and Adminstative Expenses

Introduction

 Interpretation of Financial Statements" has delved into the importance of Selling, General, and Adminstative Expenses. WarrenBuffett has learned to st away of companies with consistently high SG&A expenses. The Income Statement-Read and Use|video|hindi

we shall delve into the components and importance of Operating Expenses in the Income Statement.How To Analyze an Income Statement

The Income statement-operating expenses| hindi | VIDEO

Selling, General and Administration Expenses

Selling, General, and Administrative (SG&A) expenses are a category of costs that companies incur as part of their regular business operations. These expenses are not directly related to the production of goods or services but are essential for running the overall business and supporting

sales efforts. SG&A expenses encompass a wide range of costs and can include:

1. Selling Expenses:

Sales and Marketing Costs: These include expenses related to advertising, promotions, sales

commissions, trade shows, and other activities aimed at driving sales and increasing the

company's customer base.

Sales Salaries and Bonuses: Compensation for sales personnel, including base salaries, incentives, and bonuses based on sales performance.

 Distribution Costs: Expenses related to shipping, transportation, and distribution of products    to customers

General and Administrative Expenses (G&A):

Administrative Salaries:

 Salaries and wages of employees not directly involved in sales or production, such as administrative staff, management, human resources, and finance personnel.

 Rent and Utilities:

 Costs associated with office space, utilities (electricity, water, etc.), and facility maintenance.

Office Supplies:

 Expenses for office materials, stationery, and other supplies necessary for daily operations.

Legal and Professional Fees:

 Costs for legal services, accounting, consulting, and other professional services required for the company's operations.

 Insurance:

 Premiums paid for business insurance, liability coverage, and other forms of protection.

" Travel and Entertainment: 

Expenses related to business travel, client meetings, and employee entertainment.

" Technology and Software:

 Costs for software licenses, IT services, and technology infra-structure required for business operations.

" Depreciation and Amortization: 

Allocation of costs associated with long-term assets (such as equipment and buildings) over their useful lives.

" Employee Benefits:

 Costs for employee benefits, such as health insurance, retirement contributions, and other perks.

" Training and Development:

 Expenses for employee training, workshops, and skill development programs.

" Communication Costs: 

Expenses related to phone services, internet connections, and communication tools used by the company.

" Miscellaneous Costs: 

Other various costs that don't fall into the above categories but arenecessary for the company's operations.

• It's worth noting that the exact categorization and breakdown of SG&A expenses can vary between industries and companies, but the general principles remain consistent across businesses.Analyzing Selling, General, and Administrative (SG&A) expenses can provided valuable insights into a company's operational efficiency, financial health, and overall management. Interpreting SG&A expenses requires context, such as industry norms, company

size, growth stage, and business strategy. Comparing SG&A to revenue, gross profit, or other

relevant metrics can provide a more comprehensive understanding of a company's financial

health and operational efficiency. 

 hindi

यह ध्यान देने योग्य है कि SG&A खर्चों का सटीक वर्गीकरण और विभाजन उद्योगों और कंपनियों के बीच भिन्न हो सकता है, लेकिन सामान्य सिद्धांत व्यवसायों में सुसंगत रहते हैं। बिक्री, सामान्य और प्रशासनिक (SG&A) खर्चों का विश्लेषण कंपनी की परिचालन दक्षता, वित्तीय में मूल्यवान अंतर्दृष्टि प्रदान कर सकता है। स्वास्थ्य, और समग्र प्रबंधन। SG&A खर्चों की व्याख्या के लिए उद्योग मानदंड, कंपनी जैसे संदर्भ की आवश्यकता होती है
आकार, विकास चरण और व्यावसायिक रणनीति। SG&A की तुलना राजस्व, सकल लाभ या अन्य से करना
प्रासंगिक मेट्रिक्स किसी कंपनी की वित्तीय स्थिति की अधिक व्यापक समझ प्रदान कर सकते हैं
स्वास्थ्य और परिचालन दक्षता।

how to analysis an income statement walmart example👇

Conclusion

SG&A खर्चों पर नज़र रखना महत्वपूर्ण है क्योंकि वे यह जानकारी देते हैं कि कोई कंपनी कितनी कुशलता से काम कर रही है

इसकी गैर-उत्पादन-संबंधित लागतों का प्रबंधन करना। राजस्व के संबंध में उच्च SG&A व्यय विपणन, प्रशासन या ओवरहेड जैसे क्षेत्रों में अक्षमताओं का संकेत दे सकते हैं। SG&A खर्चों का प्रभावी प्रबंधन कंपनी की लाभप्रदता और वित्तीय प्रदर्शन को बेहतर बनाने में योगदान दे सकता है

hindi

SG&A expenses are important to track as they provide insight into how efficiently a company is

managing its non-production-related costs. High SG&A expenses in relation to revenue could indicate inefficiencies in areas such as marketing, administration, or overhead. Effective management of SG&A expenses can contribute to improving a company's profitability and financial performance

How can companies control SG&A costs?

Controlling Selling, General, and Administrative (SG&A) costs is crucial for companies to maintain profitability and operational efficiency. Here are several strategies that companies can employ to control SG&A costs:

1. Expense Monitoring and Analysis: Regularly review and analyze SG&A expenses to identify areas of overspending or inefficiency. Use financial software and reporting tools to track expenses and identify trends.

2. Budgeting and Forecasting: Develop detailed budgets and forecasts for SG&A expenses. Set spending limits for each category within SG&A and monitor actual expenses against these budgets. Adjust spending as needed to stay within budget.

3. Cost Reduction Initiatives: Implement cost reduction programs aimed at streamlining operations and cutting unnecessary expenses. This could involve renegotiating contracts with suppliers, seeking cost-effective alternatives for office supplies, and finding ways to reduce overhead costs.

4. Process Efficiency Improvements: Identify processes that can be optimized to reduce time and resource requirements. This might include automating repetitive tasks, improving workflow efficiency, and eliminating bottlenecks.

5. Outsourcing: Consider outsourcing certain functions or tasks that are not core to the business. Outsourcing can help reduce fixed costs associated with maintaining in-house staff and resources.

6. Technology Investments: Invest in technology solutions that can improve efficiency and reduce costs. For example, adopting cloud-based software can lower IT infrastructure costs, and customer relationship management (CRM) systems can enhance sales and marketing efficiency.

7. Remote Work and Telecommuting: Embrace flexible work arrangements, such as remote work or telecommuting, which can reduce costs related to office space, utilities, and other facilities.

8. Supplier Negotiations: Negotiate with suppliers to secure better terms and discounts. Bulk purchasing or long-term contracts can often lead to cost savings.

9. Employee Training and Development: Provide ongoing training to employees to enhance their skills and productivity. Well-trained employees can work more efficiently and effectively, potentially reducing the need for additional staff.

10. Expense Approval Processes: Implement strict approval processes for discretionary spending. This can help prevent unnecessary or unauthorized expenses.

11. Travel and Entertainment Expenses: Monitor and control travel and entertainment expenses, which can add up quickly. Encourage employees to choose cost-effective options when traveling for business purposes.

12. Energy Efficiency: Implement energy-saving measures in office spaces and facilities to reduce utility costs.

13. Benchmarking: Compare your company's SG&A expenses to industry peers or best practices. This can help identify areas where your costs are higher and guide your cost-cutting efforts.

14. Regular Review of Contracts: Review contracts and agreements with service providers and vendors periodically to ensure that you are getting the best value. Consider renegotiating or seeking competitive bids when contracts come up for renewal.

15. Employee Health and Benefits: Evaluate employee benefit programs and health insurance plans to ensure they are cost-effective and competitive.

Remember that while controlling SG&A costs is important, it's equally important to strike a balance between cost-cutting and maintaining operational effectiveness. Cutting costs indiscriminately could potentially harm the quality of services or products and impact employee morale. Companies should focus on eliminating waste and inefficiency while strategically investing in areas that drive growth and value.

People also ask

What is the income statement and its uses?

A company's sales, costs, and profitability over time are displayed on an income statement. It may also go by the names profit-and-loss (P&L) or earnings statement. It displays your revenue from the sale of goods or services. hindi किसी कंपनी की बिक्री, लागत और समय के साथ लाभप्रदता एक आय विवरण पर प्रदर्शित की जाती है। इसे लाभ-और-हानि (पी एंड एल) या कमाई विवरण के नाम से भी जाना जा सकता है। यह वस्तुओं या सेवाओं की बिक्री से आपका राजस्व प्रदर्शित करता है

2.What income statement formats may be used?

It is possible to show the revenue statement in a "one-step" or "two-step" manner. Revenues and gains are gathered together in a "one-step" style. The income statement can be presented in either one of two popular formats: single-step or multi-step. A corporation can create either a single-step income statement or a multi-step income statement, two different sorts of income statements. hindi राजस्व विवरण को "एक-चरण" या "दो-चरण" तरीके से दिखाना संभव है। राजस्व और लाभ को "एक-कदम" शैली में एक साथ इकट्ठा किया जाता है। आय विवरण दो लोकप्रिय प्रारूपों में से किसी एक में प्रस्तुत किया जा सकता है: एकल-चरण या बहु-चरण। एक निगम एकल-चरण आय विवरण या बहु-चरण आय विवरण, दो अलग-अलग प्रकार के आय विवरण बना सकता है।

the income statement vs the balance sheet?

Owning vs operating: A balance sheet reports what a company owns at a specific date. An income statement details a company's performance over a given time period. What's Been Report: Equities, liabilities, and assets are listed on a balance sheet. Revenue and expenses are detailed in an income statement.

What are the three purposes of an income statement?

The statement of earnings presents a company's expenses, income, gains, and losses, which may be used to calculate the net profit or loss for that time period using a mathematical calculation. This data enables you to make prompt decisions to ensure that your company is financially stable.

1. What is the income statement and its uses?

A company's sales, costs, and profitability over time are displayed on an income statement. It may also go by the names profit-and-loss (P&L) or earnings statement. It displays your revenue from the sale of goods or services.

hindi

किसी कंपनी की बिक्री, लागत और समय के साथ लाभप्रदता एक आय विवरण पर प्रदर्शित की जाती है। इसे लाभ-और-हानि (पी एंड एल) या कमाई विवरण के नाम से भी जाना जा सकता है। यह वस्तुओं या सेवाओं की बिक्री से आपका राजस्व प्रदर्शित करता है

1. What income statement formats may be used?

• It is possible to show the revenue statement in a "one-step" or "two-step" manner. Revenues and gains are gathered together in a "one-step" style.

•  The income statement can be presented in either one of two popular formats: single-step or multi-step.

• A corporation can create either a single-step income statement or a multi-step income statement, two different sorts of income statements.

hindi

• राजस्व विवरण को "एक-चरण" या "दो-चरण" तरीके से दिखाना संभव है। राजस्व और लाभ को "एक-कदम" शैली में एक साथ इकट्ठा किया जाता है।
•  आय विवरण दो लोकप्रिय प्रारूपों में से किसी एक में प्रस्तुत किया जा सकता है: एकल-चरण या बहु-चरण।
• एक निगम एकल-चरण आय विवरण या बहु-चरण आय विवरण, दो अलग-अलग प्रकार के आय विवरण बना सकता है।

1. the income statement vs. the balance sheet?

Owning vs operating: A balance sheet reports what a company owns at a specific date. An income statement details a company's performance over a given time period. What's Been Report: Equities, liabilities, and assets are listed on a balance sheet. Revenue and expenses are detailed in an income statement.

1. What are the three purposes of an income statement?

The statement of earnings presents a company's expenses, income, gains, and losses, which may be used to calculate the net profit or loss for that time period using a mathematical calculation. This data enables you to make prompt decisions to ensure that your company is financially stable.

1.  income statement analysis example?

how to analysis an income statement walmart example

1. What is the main purpose of income statement?

An income statement's objective is to tell investors, creditors, and readers about the company's profitability during the fiscal year. In the context of corporate finance, the income statement is a record of the company's profit and loss for the end year.

hindi

• आय विवरण का उद्देश्य निवेशकों, लेनदारों और पाठकों को वित्तीय वर्ष के दौरान कंपनी की लाभप्रदता के बारे में बताना है। कॉर्पोरेट वित्त के संदर्भ में, आय विवरण वित्तीय वर्ष के लिए कंपनी के लाभ और हानि का रिकॉर्ड है।
• आय विवरण का उद्देश्य निवेशकों, लेनदारों और पाठकों को वित्तीय वर्ष के दौरान कंपनी की लाभप्रदता के बारे में बताना है। कॉर्पोरेट वित्त के संदर्भ में, आय विवरण वित्तीय वर्ष के लिए कंपनी के लाभ और हानि का रिकॉर्ड है।

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