Definition of 'Above-The-Line Costs'
Costs incurred during the production of an advertising commercial that are associated with the creative side of it. These costs include those incurred for actors, music and photography. Because creativity cannot be measured directly, above-the-line costs may have little correlation with the creativity of an advertisement or commercial. That is, incurring high above-the-line costs may not necessarily result in a commercial with a high degree of creativity, while a low-budget commercial with minimal above-the-line costs may still be quite creative.
In accounting, above-the-line costs can also refer to costs included in the calculation of net income in the income statement.
Investopedia explains 'Above-The-Line Costs'
Above-the-line costs are the polar opposite of below-the-line costs in advertising, which are costs associated with the non-creative part of the advertising commercial production. Below-the-line costs include expenses for props and equipment.