Which of the following is an S&A charge?

• A. Construction quality assurance
• B. Site surveys
• C. Equipment depreciation
• D. Warranty claims

Answer: (A)

S&A charges cover costs that support the business as a whole and can’t be traced directly to a single project; they’re overhead. Construction quality assurance fits this because it’s an administrative/organizational function that ensures standards across the entire construction program, rather than being a direct, billable activity on one specific site. It supports project delivery but isn’t tied to a specific unit of work, so it’s categorized as a selling and administrative expense.

Site surveys, in contrast, are work performed for a particular project and can be directly attributed to that project, so they’re treated as direct project costs. Equipment depreciation is an asset-related expense tied to long-term use and is typically allocated as overhead rather than a pure S&A item. Warranty claims arise after delivery and relate to post-sales obligations, usually handled as costs of sales or warranty expenses rather than selling/administrative charges.