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7 | Consolidated Financial Statements | Notes to the Consolidated Financial Statements
4. Revenue
Table  7.09 shows the composition of revenue at Group level.
Revenue by segment  7. 86 and region  7.8 8 is presented
in Note 32.
5. Functional costs
Cost of sales. Items included in cost of sales are shown
in table  7.10.
Selling expenses. In 2012, selling expenses amounted to
€10,451 million (2011: €9,824 million). Selling expenses include
direct selling costs as well as selling overhead expenses and
consist of personnel expenses, material costs and other selling
costs.
General administrative expenses. General administrative
expenses amounted to €3,973 million in 2012 (2011: €3,855
million) and comprise expenses which were not attributable
to production, sales, research and development functions,
including personnel expenses, depreciation and amortization
on fixed and intangible assets, and other administrative costs.
Research and non-capitalized development costs.
Research- and non-capitalized development costs were €4,179
million in 2012 (2011: €4,174 million) and primarily comprise
personnel expenses and material costs.
Amortization expense of capitalized development costs
is recognized in cost of sales and amounted to €982 million
in 2012 (2011: €829 million).
Optimization programs. Measures and programs with
implementation costs that materially impacted EBIT of the
segments are briefly described below:
Daimler Buses. Daimler Buses decided in the first quarter
of 2012 to restructure some sections of its business system.
The first step is to define measures to improve efficiency
and generate growth in order to increase the market shares
of buses in Western Europe, to adapt the product portfolios
to changed market requirements and to reduce cost positions.
Among other things, the production network will also be
optimized. In March 2012, the Board of Management announced
the reduction of up to 10% of the workforce of EvoBus GmbH
and of some subsidiaries in Western Europe. This headcount
reduction is to be solely achieved by means of socially acceptable
measures. Furthermore, in the second quarter of 2012, the
Board of Management decided to restructure the activities of
Daimler Buses in North America. In this context, Daimler Buses
sold the assets related to Setra to Motor Coach Industries
International Inc. (MCI). MCI has taken over the general distribu-
tion of the Setra coach models S 407 and S 417 in the North
American Market and Daimler Buses has received a share
of 10% of the equity of MCI. Due to the decreasing investment
volumes of public transportation companies, the ongoing
reduced demand for city buses and the negative outlook, Daimler
Revenue
2012 2011
In millions of euros
Sales of goods 100,531 94,274
Rental and leasing business 10,166 9,014
Interest from the financial services business
at Daimler Financial Services
3,224
2,893
Sales of other services 376 359
114,297 106,540
7. 0 9
Cost of sales
2012 2011
In millions of euros
Expense of goods sold -80,580 -73,335
Depreciation of equipment on operating leases -3,813 -3,370
Refinancing costs at Daimler Financial Services -1,861 -1,849
Impairment losses on receivables from
financial services
-390
-417
Other cost of sales -2,140 -2,052
-88,784 -81,023
7.10