revenue expenditure

types of revenue expendeture 

• Inventory​

• Rent​

• Rates​

• Heating & Lighting​

• Water​

• Insurance​

• Administration​

• Salaries​

• Wages​

• Marketing​

• Bank Charges​

• Interest Paid​

• rent Depreciation

what is revenue expendeture

spending on items on a day-to-day or regular basis. These are the expenses incurred by a business that are shown on the profit and loss account (also known as a statement of comprehensive income). The types of costs incurred vary from business to business

inventory

costs incurred by the business for the paperwork aide of the business

rent

This is the cost of using premises not owned by the business. These are regular payments, usually monthly, for the use of premise

rates 

This is a sum of money paid to the local council to go towards services such as street lights and refuse collection. This is not a set amount, but is calculated by the council based on the size and location of the premises

heating and lighting

This covers payments for services such as gas and electricity. The business will receive regular bills, often quarterly (every three months) for the provision and use of these services.

water 

This involves payment for the supply of water to premises and use of water. This can be a fixed rate or based upon usage if a water meter is fitted

insurance 

a business is legaly required to take out a number of types f insurance to protect itself from the possibility of serious losses such as

• buldings insurance

• contents insurance

• public liability insurance

• employers’ liability insurance

administration

paperwork that goes on within a business such as

• internally between employees

• externally with suppliers and customers

• Administrative costs include items such as postage, printing and stationery

• Telephone charges

salaries

annual figure paid to an employee divided into equal monthly payments.

wages

is an hourly rate paid to an employee, meaning there is a direct link between the number of hours worked and the amount of money paid

marketing

attracting the customer and convinsing them to make a purchase some costs may include 

• advertisements 

• promotinal litradeture 

• promotinal events 

• points of sale materials 

bank charges

banks charge businesses for each transaction that takes place, for example, every time a cheque is paid in or written, whenever cash is deposited, Banks might offer free banking to businesses for the first year as a marketing technique, but, once the first year is over, bank charges can soon start to add up to quite a large amount of money.

interest paid

If the business has a bank loan or a mortgage, then interest will be charged on this,Banks may offer big businesses preferential rates if they are confident that the money will be paid back and if they want to keep that particular business as a loyal customer

straight line depreciation

an asset is depreciated by a set amount each year

reducing balance depreciation

an asset is depreciated by a set percentage of its remaining value each year

discount allowed

Reductions offered to customers are an expense to a business as it reduces the amount of cash flowing into the business theise may be allowed to attract customers, for bulk purcheses or to gain a competative advantage