Difference between revisions of "Expense"
Jump to navigation
Jump to search
m |
|||
| Line 2: | Line 2: | ||
As an example, buying toner for the office printer is an expense. However, the printer itself is generally not an expense, but an asset purchase. (In some larger companies, purchases of assets under a certain amount are treated as expenses due to the small amount involved.) | As an example, buying toner for the office printer is an expense. However, the printer itself is generally not an expense, but an asset purchase. (In some larger companies, purchases of assets under a certain amount are treated as expenses due to the small amount involved.) | ||
| + | |||
| + | On a financial statement, a "prepaid expense" is an amount which is for an expense covering a period of time in the future. A common example is an insurance premium, which often covers portions of more than one fiscal year. | ||
[[Category:Accounting Terms]] | [[Category:Accounting Terms]] | ||
| − | |||
| − | |||
Revision as of 16:39, July 26, 2022
An expense, in business and accounting, is the spending of money for reasons other than the purchase of an asset or the repayment of a liability.
As an example, buying toner for the office printer is an expense. However, the printer itself is generally not an expense, but an asset purchase. (In some larger companies, purchases of assets under a certain amount are treated as expenses due to the small amount involved.)
On a financial statement, a "prepaid expense" is an amount which is for an expense covering a period of time in the future. A common example is an insurance premium, which often covers portions of more than one fiscal year.