Management expenses include expenses that are not directly related to production and the sales process (performance of work, provision of services). In particular, money for rent, depreciation costs, salaries of managers, accountants, lawyers, payment for communication services. In accounting, they are recorded under account 26 "General business expenses".
How to display management expenses in financial analysis?
Management costs do not depend on production volumes, so they are considered conditionally constant. When output grows, the amount of management costs per unit decreases and, accordingly, profit increases (again, per unit). This profit can be increased by reducing management costs by reducing the management staff (this will result in good savings on salaries). It would be good to simultaneously start producing more products (or at least maintain the same volumes). The choice of method for increasing profit per unit of goods is at the discretion of the enterprise. Many combine both approaches described.
What expenses are prohibited from being considered as management expenses?
Any costs directly related to the lebanon email list production process, provision of services, performance of work. For example, money for raw materials, consumables, workers' salaries, etc.
Is it possible to take management costs into account when calculating income tax?
Yes, this is possible, but it is necessary that management expenses meet the general criteria for recognizing expenses. That is, they must be provided with clear economic justifications, everything must be documented. In addition, they must be produced through income-generating activities and redirected to ensure such activities.
Is it permissible to include management expenses in the cost price?
This can be done, but it must be done taking into account the revenue (per month, quarter, year) received from the sale of different types of products, that is, to relate everything proportionally.