expense

  

Definition

Money spent or cost incurred in an organization's efforts to generate revenue, representing the cost of doing business.

Expenses may be in the form of actual cash payments (such as wages and salaries), a computed expired portion (depreciation) of an asset, or an amount taken out of earnings (such as bad debts). Expenses are summarized and charged in the income statement as deductions from the income before assessing income tax. Whereas all expenses are costs, not all costs (such as those incurred in acquisition of income generating assets) are expenses.


Use expense in a sentence

  • Knowing the expense of what it costs to run your business will tell you how much you need to charge to ensure a profit.

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  • Determining what the expense to make a product is will allow you to come up with the right price to charge.

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  • The company's expenses surpassed its revenue. Therefore they were at a loss for the fiscal year. Maybe they should have charged more money for their product.

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