Accounting For Customer Support

Is there any guidance on where customer support payroll expenses should go - COGS or Opex? We do not manufacture products, but the business is a subscription box rental company. Our operations/fulfillment payroll expenses are included in COGS but don't have clear guidance on where customer support payroll expenses should be classified.

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Len Green Performance Improvement Consultant and ERP Strategist • February 23, 2016

Hi Rachel
What does Customer Support do in your business? Some companies see them as (a) Sales order entry, (b) post sales support/customer service or (c) both.

Either way, look at COGS = cost of getting goods to point of sale. That, in my view, means customer support are either a selling expense or an opex. They are not involved in "getting goods to point of sale."

Katherine Simmonds Agent • February 24, 2016

Thanks Len. The function responds to customer inquiries which consist of canceling memberships, issuring refunds, sending replacement products if their items are damaged, etc.

Wayne Spivak President & CFO • February 24, 2016

I would place in G&A.

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Accounting For Customer Support

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