Question

Sheila owns a childcare business. Since this market is competitive, she has hired an advertising and sales manager to make sure potential customers know about her company. As a result, she must pay for advertising materials and her advertising and sales manager's salary. These expenses would be classified as ________ expenses.

Answer 1

OPTIONS:

A. administrative

B. interest

C. general

D. development

E. selling

Answer:

E. selling

Explanation:

Selling expenses include all the costs that are incurred in the process of marketing or advertising, distributing, and selling of a product or service.  

Selling cost which is one of the operating expenses of a business, also includes costs that are associated with logistics, shipping of the products, and also includes the salary to be paid to those hired to promote the sales of the product or service, as well as commissions attached to sales.

The expenses given in the question, which are associated with the promotion of the services rendered by Sheila’s company, would be classified as selling expenses.

Answer 2

Answer:

The correct answer is: marketing expenses.

Explanation:

To begin with, the marketing expenses are those that the company must make in order to obtain a marketing program done such as publicity campaigns. Moreover, this type of expenses include every payment that the company would consider as marketing investment that can improve the development of the organization an its sales to the target audience, therefore that both the materials and the salaries whose goal is to create a marketing campaign will be consider and classified as marketing expenses.