Quick Answer: What Are The 3 Types Of Expenses?

What are the two main categories of expenses?

Key Takeaways There are two main categories of business expenses in accounting: operating expenses and non-operating expenses..

How do you list expenses?

Steps to Track Your ExpensesWrite down your monthly income.Write out your monthly expenses. Start with food, shelter (your mortgage or rent plus utilities), clothing, and transportation. … Make sure your income minus your expenses equals zero.

What are the monthly expenses?

This list highlights some of the most common monthly expenses to factor into your budget:Housing. Your housing expenses are likely your single-largest budget item. … Food. Your monthly food expense includes everything that you spend on eating. … Transportation. … Childcare and pet care. … Cell phone. … Health insurance. … Debt. … Savings.More items…•

Is rent a fixed expense?

Fixed costs remain the same regardless of whether goods or services are produced or not. Thus, a company cannot avoid fixed costs. … The most common examples of fixed costs include lease and rent payments, utilities, insurance, certain salaries, and interest payments.

What are personal expenses?

1. personal expense – the cost of personal or family living; “some personal expenses are tax deductible” disbursal, disbursement, expense – amounts paid for goods and services that may be currently tax deductible (as opposed to capital expenditures)

Is electricity a fixed expense?

Some utilities, such as electricity, may increase when production goes up. However, utilities are generally considered fixed costs, since the company must pay a minimum amount regardless of its output.

Is rent an expense?

Rent expense is the cost incurred by a business to utilize a property or location for an office, retail space, factory, or storage space. Rent expense is a type of fixed operating cost or an absorption cost for a business, as opposed to a variable expense.

What are the 4 types of expenses?

Terms in this set (4)Variable expenses. Expenses that vary from month to month (electriticy, gas, groceries, clothing).Fixed expenses. Expenses that remain the same from month to month(rent, cable bill, car payment)Intermittent expenses. … Discretionary (non-essential) expenses.

What are startup costs?

Key Takeaways. Startup costs are the expenses incurred during the process of creating a new business. Pre-opening startup costs include a business plan, research expenses, borrowing costs, and expenses for technology. Post-opening startup costs include advertising, promotion, and employee expenses.

Is salary A expense?

Salaries expense is the fixed pay earned by employees. The expense represents the cost of non-hourly labor for a business. … Salaries expense – accounting department. Salaries expense – engineering department.

What are the 3 categories of expenses?

There are three major types of expenses we all pay: fixed, variable, and periodic.

What are some examples of expenses?

Examples of ExpensesCost of goods sold.Sales commissions expense.Delivery expense.Rent expense.Salaries expense.Advertising expense.

What are basic expenses?

Basic cost-of-living expenses include housing, food, transportation, child care, health care and other necessities, according to the Economic Policy Institute.

What is the 70 20 10 Rule money?

70% of your monthly budget should go to monthly expenses. 20% should go to savings.

What are the normal monthly expenses?

Necessities often include the following:Mortgage/rent.Homeowners or renters insurance.Property tax (if not already included in the mortgage payment).Auto insurance.Health insurance.Out-of-pocket medical costs.Life insurance.Electricity and natural gas.More items…