Expenses are Debit in nature
gh hkjk
Legal expenses is not an admin expenses since legal expenses ararise due to legal issues of the organization. legal expenses are not recurring expenses by nature. Example of legal expenses are feees paid to the professional to represent the legal issues before the competent authority.
Revenue expenses are those expenses which are incurred for every fiscal year to earn revenue for specific fiscal year and are recurring nature like salaries etc.
Prepaid expenses are of asset in nature because these are payments which have made already but actual expense is not yet incurred so it is shown in current assets under balance sheet until actual expenses incurred.
If electricity expense is dependant on production level then it is variable expenses other wise some of expenses may be of variable nature while some part is fixed or semi variable nature as well.
gh hkjk
It depends on the nature, if expenses are paid and benefits are also rendered then expenses will be shown in income statement, but if benefits not received then it will be shown in balance sheet.
Legal expenses is not an admin expenses since legal expenses ararise due to legal issues of the organization. legal expenses are not recurring expenses by nature. Example of legal expenses are feees paid to the professional to represent the legal issues before the competent authority.
Revenue expenses are those expenses which are incurred for every fiscal year to earn revenue for specific fiscal year and are recurring nature like salaries etc.
Prepaid expenses are of asset in nature because these are payments which have made already but actual expense is not yet incurred so it is shown in current assets under balance sheet until actual expenses incurred.
If electricity expense is dependant on production level then it is variable expenses other wise some of expenses may be of variable nature while some part is fixed or semi variable nature as well.
Classification by nature means that an analysis based on the nature of expenses would, for example, result in classifications for depreciation, purchases, wages and salaries, marketing costs etc. The expenses would be presented in total for each type of expense. Classification by function means that when an analysis is based on the function of the event (or cost of sales method), this will classify expenses according to their function as part of cost of sales, distribution or administrative activities. While this presentation can provide more relevant information to users, the allocation of costs to function can often be arbitrary. Organisations who chose to do this should disclose additional information on the nature of expenses, including depreciation and staff costs. The enterprise should choose the analysis that provides the fairest presentation of the business activities.
All the expenses and incomes are recorded in nominal accounts, whether capital or revnue nature
An expense is incurred when a business contract to purchase goods or accept services which will not constitute a resource for the future from which economic benefits can be expected to flow. In other words, an expense is a cost which is not classified as an asset to the business.
see outstanding expenses r those expenses that runpaid at the end of accounting period like salaries,rent so they all come under nominal accounts which is "debit all expenses and losses and credit all gains". since they r unpaid hence they must be credited....
purchases is related to products expenses are recuring in nature , direct exp are related to products and indirect exp are not related to products
revenue expenditure is recurring in nature. It is incurred to operate day to day expenses. eg salaries and wages, printing and stationery.