Definition and Examples of a Flexible Expense Flexible expenses, also known as variable expenses, are costs you pay that can change from week to week or month to month. As a consumer, you most likely understand that an expense is a cost you pay for products and services that you buy ...
Examples of Expense Some of the expenses that will be reported on a retailer’s income statement for the month of August include: Cost of goods sold for the August sales. (The date that the retailer had paid for the goods is not pertinent.) Commissions earned by the sales staff for havin...
But a solid sales budget may be used to inform a sales forecast. A sales budget is also different from a sales expense budget, which focuses on company expenses over a certain period of time. What is a sales budget used for? The sales budget is a planning tool that allows companies ...
A company's gross margin is its net sales less its cost of goods sold. It's what a business earns from the sale of its services or products before deducting administrative expenses.2 What Are Some Semi-Variable Administrative Expenses? Semi-variable administrative expenses can include salaries, ...
According to most tax authorities, a business expense has to be both necessary and ordinary. Ordinary means it is common or accepted in that sector, while necessary means it was needed or helpful in pursuit of making sales, i.e. earning income. ...
The principal is not an operating expense. Principal repayments are recorded as a finance expense. 5. Income taxes – taxes that are applied to business profits are recorded as an expense. But VAT may not be counted as an expense because the money never belonged to the business....
You might think that building rent is considered a general expense because it doesn’t contribute to sales, but it does. The sales floor has no other purpose except to display and sell product. This means it is solely used to sell goods. The rental space that is used for storage, offices...
Definition:An expense is the cost of an asset used by a company in its operations to produce revenues. In other words, an expense is the use of assets to create sales. Notice that I didn’t say it’s the amount of money spent to generate sales. Expenses are created when an asset is...
Selling, general, and administrative expense is basically a fancy name for operating costs. Read this article to learn what is included in SG&A expense, and why it is a significant number.
An operating expense is an expense that is related to a business’s core operations. Operating expenses (OPEX) are the first expenses shown on a company’s profit and loss statement. The amount left over after operating expenses have been deducted from gross revenue is known as operating income...