Operating Expenses

Accounting Dictionary

Operating Expenses

Operating expenses are the expenses you incur to run your business.

John paid $4000 for inventory, $9000 for salesmen, and $400 to consult with a financial planner about investing the company profits in stock. His operating expenses are $13,000 ($4000 + $9000). The $400 is not an operating expense because it has nothing to do with running his store.

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