An Expense is every sacrifice (Consumption of goods or services to obtain Income) of the company to earn Income. It is reflected through a reduction in cash (in case of cash payment) or through an increase in a debt - Liabilities (to be paid over a period). The expense may also result from other reductions in Assets (other than Cash), as in the case of wear and tear of machines and others.
Examples:
- Water and Sewage
- Rent Payable
- Coffee and Snacks
- Discounts Granted
- Social Security Contribution
- Taxes
- Freight
- Office Material
- Interest Payable
- Electricity and Telephone
- Cleaning Material
- Salaries
- Insurance Bonus
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