荣耀电竞官网软件下载

Definition: An expense is the cost of an asset used by a company in its operations to produce revenues. In other words, an expense is the use of assets to create sales. Notice that I didn’t say it’s the amount of money spent to generate sales. Expenses are created when an asset is used up, not when  cash  is paid out. Take  depreciation expense  for example.

What Does Expense Mean?

The expense account is a  contra   equity account  that has a debit balance. This means that equity is decreased as the company generates more expenses. This only makes sense since expenses lower the net income or profits of the company. You can see this clearly in the  expanded accounting equation  where equity = owner’s capital – withdrawals + revenues – expenses. As the expense account increases, the total equity of the company decreases.

Some common examples of costs are employee salaries, advertising, rent, utilities, taxes, and supplies. All of these costs are reported on the  income statement  at the end of an accounting period. Depending on the financial statement format, the costs might be categorized in different subcategories like selling and general administrative. Regardless how they are categorized, the total expenses are calculated and subtracted from the total revenues to calculate the net income for the period.

Let’s take a look at some examples.

Example

Corey’s Food Truck, Inc. is a local food company that delivers sandwiches on the Santa Monica beach. Corey places new deli orders for $100 every Monday to a local butcher. When Corey places his order, he debits supplies for $100 and credits cash for $100. This  journal entry  records the asset, cash, being used up to generate revenues by making sandwiches.

At the end of the year, Corey spends a total of $5,200 on deli meat and lists this as an expense on his income statement.


[i]
[i]
雷火电竞下注投注(雷火电竞公告即时) pc28加拿大全天计划手机版授权平台 荣耀电竞排榜即时(荣耀电竞联赛新版v1.5) 28加拿大查询开奖下载 28加拿大开奖查询视频 蜂巢电子竞技公告积分