Financial Terms / expense

Expenses are the cost of doing business, from payments to suppliers to employee wages. Companies can write off tax-deductible expenses on their income tax returns, and there are two types of expenses: operating and non-operating.

## Formula

``EXP = Total Revenues - Net Income ``

## How do I calculate the expense?

`To calculate expenses, start by calculating net income by subtracting total expenses from total revenues. This can be done in either Sourcetable. The formula for calculating net income is as follows: `Net Income = Total Revenues - Total Expenses. Once net income is calculated, subtract it from total revenues to arrive at total expenses`. This will provide you with an accurate picture of your total expenses.`

## What are Expenses?

`Expenses are the cost of operations a company incurs to generate revenue. This includes payments to suppliers, employee wages, factory leases, and equipment depreciation.`

## What are Tax-Deductible Expenses?

`Tax-deductible expenses are expenses that businesses can write off on their income tax returns.`

## What are the two main categories of business expenses?

`The two main categories of business expenses are operating expenses and non-operating expenses.`

## What are Operating Expenses?

`Operating expenses are expenses incurred by the company for its main activities.`

## Key Points

How do I calculate expense?
`EXP = Total Revenues - Net Income `
Tax-Deductible Expenses
Businesses can write off certain expenses on their income tax returns, which can result in a decrease in the amount of taxes owed. These tax-deductible expenses are a great way for businesses to save money.
Operating vs. Non-Operating Expenses
Businesses incur expenses in two main categories: operating expenses and non-operating expenses. Operating expenses are those expenses associated with running the day-to-day operations of a business, such as rent, salaries, and utilities. Non-operating expenses are those expenses not associated with the day-to-day operations of the business, such as taxes, interest, and depreciation.