Expenses

Expenses are costs incurred by an individual or business in order to generate revenue. Expenses are typically categorized as either operating expenses or non-operating expenses. Operating expenses are those incurred in the day-to-day operations of a business, such as rent, utilities, and payroll. Non-operating expenses are those incurred outside of the normal course of business, such as interest payments, taxes, and legal fees. Expenses are typically recorded in an accounting system and are used to calculate the net income of a business.

History of Expenses

The concept of expenses has been around since the dawn of commerce. In ancient times, merchants would record their expenses in order to track their profits and losses. As commerce evolved, so did the concept of expenses. In the modern era, expenses are tracked and recorded in an accounting system in order to calculate the net income of a business. Expenses are also used to calculate the cost of goods sold, which is used to calculate the gross profit of a business.

Comparison of Expenses

Summary

Expenses are costs incurred by an individual or business in order to generate revenue. Expenses are typically categorized as either operating expenses or non-operating expenses. Operating expenses are those incurred in the day-to-day operations of a business, such as rent, utilities, and payroll. Non-operating expenses are those incurred outside of the normal course of business, such as interest payments, taxes, and legal fees. For more information about expenses, visit websites such as Investopedia, The Balance, and AccountingTools.

See Also

• Revenue
• Cost of Goods Sold
• Gross Profit
• Net Income
• Accounting
• Cash Flow
• Income Statement
• Balance Sheet
• Taxes
• Fixed Costs

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