Commission expense accounting. February 15, 2018. A commission is a fee that a business pays to a salesperson in exchange for his or her services in either facilitating, supervising, or completing a sale. The commission may be based on a flat fee arrangement, or (more commonly) as a percentage of the revenue generated.
So, what is the commision?
commission. A commission is also an order for someone to do something and get paid: The artist received a commission for a new painting to hang in the building lobby. And a commission is a high-ranking position in the armed forces, or a special committee that controls or investigates something.
What is a commission charge?
A commission is a service charge assessed by a broker or investment advisor in return for providing investment advice and/or handling the purchase or sale of a security. Most major, full-service brokerages derive much of their profits from charging commissions on client transactions.
Why do stock brokers charge commissions?
Trade commissions: Charged by a broker when you buy or sell certain investments, such as stocks. Mutual fund transaction fees: Charged by a broker to buy and/or sell some mutual funds. Sales loads: A sales charge or commission on some mutual funds, paid to the broker or salesperson who sold the fund.