Commercial expenses are what? What do commercial costs include?

Quite often you can find the concept of "commercial costs", and those who encounter it for the first time, it is worth familiarizing with it in more detail. This will be especially useful for future economists and accountants, as well as for employees of commercial organizations.

Definition

Commercial expenses are expenses that are directed to the shipment and sale of products, as well as services for its packaging by third parties, delivery, loading, etc. Legislation does not establish this concept. Quite often, users are confronted with the expression "commercial costs are the costs of company circulation." It is necessary to understand that this definition is correct, this is the legislative confirmation.

The Tax Code specifies that distribution costs represent implementation costs for organizations that specialize in retail, small wholesale and wholesale trade in a variety of goods. Despite the fact that the concept in question is absent in the Tax Code of the Russian Federation, it occurs in the course of accounting. In this case, commercial expenses are line 2210, which is in the income statement.

What are the costs of this category?

If you consider the list of such costs, you can create a full picture of the term. Commercial expenses include the following items:

• Services for packaging in stock of finished products.
• Transportation.
• Carrying out loading and unloading of goods from vehicles.
• Commission costs.
• The cost of renting and maintaining the premises in which the goods are stored until the moment of sale.
• The payment of labor of the sellers of the company, engaged in the production of products.
• Hospitality.
• Marketing expenses.
• Payment of labor of employees of trading companies.
• Lease of retail space and storage facilities for placement of finished products.
• Insurance of products.
• Insurance of commercial risks.
• Similar costs aimed at selling goods.

Having learned that commercial expenses include, it is possible to understand the importance they have for the enterprise and its accounting.

What determines the amount of commercial expenses?

It is necessary to consider the main categories of costs and factors affecting their formation:

• Delivery of products. Depends on the transportation distance, transportation tariffs of the company, the weight of the cargo, and also the type of vehicle.
• Loading and unloading. They change in connection with the reduction or increase in the weight of products, as well as the price for this service per one ton of goods.
• Packaging materials and containers. Their value is determined by the quantity and price per piece. The first indicator is related to the volume of production and the required materials for packaging one unit. Commercial expenses of an enterprise of this type are those that are not to be excluded. This is due to the fact that aesthetically attractive packaging is one of the factors of increasing demand for the product, so savings in this case is undesirable. The costs of this category will pay off by increasing sales. Also it can be said about the study of sales markets, advertising and other marketing research.

Once all commercial costs have been analyzed, it is necessary to determine how to reduce them, as well as to develop clear recommendations for mastering this procedure.

What are the differences between commercial costs in manufacturing and trading companies?

It is worth noting that production companies only include in this category those funds that were used in the sale of products. The expenses of commercial organizations include everything that relates to the main activity.

It is worth highlighting the following costs of this type of production organizations:

• Packing of goods and copacking services;
• Transportation of goods to the place of departure;
• The amount of commission fees paid by organizations;
• Rent of premises for placing products in the place of its sale;
• Costs for representatives;
• advertising;
• Other expenses, similar in purpose.

Thus, it can be concluded that for manufacturing companies, commercial expenses are means aimed at ensuring the sale of products.

Budget

Budgeting is a modern financial tool designed by enterprises to implement specific goals. Timely budgeting and their adjustment are an important detail when they are formed for the enterprise. At the same time, a budget of commercial expenses is also drawn up. With its help, you can determine the company's costs for market research, product advertising and sales.

In the budgeting process, it is necessary to take into account the fact that its amount is taken into account with VAT without amortization of funds. With respect to commercial expenses, it is made by months. If necessary, this budget can be broken down by day. The schedule must be compiled daily.

What features should be considered?

Commercial expenses can be divided into conditionally fixed and conditional variables. Depending on the segmentation of the market, they can be grouped according to a variety of criteria. The company's costs are correlated with sales volumes. For their appearance and distribution, this will become an economic justification. If the firm will implement the program to reduce sales costs, it should be understood that sales volumes are unlikely to increase, rather, they will even decline.

Variable costs need to be planned depending on the life cycle of the product, expressing them as a percentage of the sales volume. If they occupy a significant role in the enterprise, they need to be regularly adjusted, as the system of managing commercial costs will be changed.

Expenses of commercial banks

They represent the use of funds that are necessary for the performance of existing types of banking activities. They are classified by the method of accounting, period, nature and form of education. The expenses and incomes of a commercial bank can be subdivided in a similar way:

• To ensure the functioning of the bank;
• Operational and commission costs, for operations in financial markets, etc .;
• Other.

At the same time, the bank's revenues are divided into the following types:

• From banking transactions;
• Operating income ;
• Other.

To a special group, in practice, the expenses of a commercial bank are aimed at forming a reserve fund. With its help, losses on loans and losses on active operations, as well as depreciation of securities, are covered.

Conclusion

The presented information allows to understand what are the commercial costs for different activities. It is required to adhere to the algorithm of budgeting. This will help to avoid incorrect definition and drawing up of plans-graphs. Also, it should be done so that the amount of costs is as accurate as possible, and you could create a program to reduce them, so that this does not lead to a reduction in profits. The category of commercial costs should be considered in detail in order to exclude the possibility of making mistakes.