Expenses Elements

Expenses are the costs incurred or consumed in the process of producing revenues.

Examples of Expenses Elements

Direct Cost to produce revenue

• Cost of Sales – cost of Merchandising inventory sold. 
• Cost of Service - direct cost of service rendered
• Cost of Goods Manufactured and Sold – cost of sold manufactured goods.

Operating Expenses

1. Marketing and Selling Expenses - pertains to costs in doing marketing and selling activities of the entities

• Commissions 
• Advertising and Promotions 

2. General and Administrative Expenses - pertains to costs in operating and administering activities of the organization. 

• Salaries and Wages
• Travel, Transportation, Gas and Oil
• Taxes and Licenses
• Rent
• Insurance
• Supplies
• Utilities: Communications, Electricity and Water 
• Utility Services: Janitorial, Security Guards
• Depreciation

Other Expenses and Losses 

• Interest Expense
• Loss on disposal of equipment 
• Income tax expense

Researched by: