SG&A stands for "Selling, General, and Administrative" expenses, which are the costs a company incurs to promote, sell, and deliver its products and services, as well as to manage day-to-day operations. SG&A expenses are a category of expenses that includes nearly all business costs not directly attributable to making a product or performing a service. These expenses are fixed costs that a company incurs to operate its business and are not directly related to production. Examples of SG&A expenses include rent, utilities, marketing and advertising, sales and accounting, management and administrative salaries, and legal fees.

SG&A expenses are not considered part of the cost of goods sold (COGS) and appear on the income statement between COGS and interest and depreciation. SG&A expenses are a key component of tracking net income, or whats left over after subtracting expenses and taxes from revenue. SG&A expenses play a key role in a companys profitability and the calculation of its break-even point.

To calculate SG&A expenses, a company adds up all of its selling expenses and general and administrative expenses. SG&A expenses can be forecasted through any of the following methods: as a percentage of sales revenue, a growth rate over the last period, or as a fixed dollar value.

In summary, SG&A expenses are the costs a company incurs to operate its business and are not directly related to production. These expenses are a key component of tracking net income and play a key role in a companys profitability.