revenue expenditure - C Flashcards
(14 cards)
inventory
raw materials, stock, can be bought on credit when the business is more established
rent
cost of using a premises, regular payments (monthly)
rates
sum of money paid towards local council towards street lights, this is a set amount
heating and lighting
covers for payments such as gas and electricity
water
supply of running water to the premises
insurance
requirement to take out payments to protect themselves from risk of serious losses, such as
- building & contents insurance
- public liability insurance (protection if harmed or injured)
- employers liability insurance
administration
refers to the paperwork occurring between a business either internally between employers and employees or externally between employers and suppliers
salaries
annual figure paid to an employee divided into equal monthly payments
wages
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
covers a whole range of costs associated with attracting the customer and convincing them to make a purchase
bank charges
banks charge businesses for each transaction that takes place, a free first year may be offered for marketing purposes but that is the extent of free
interest paid
if a business has taken out a loan or a mortgage, then interest will be paid on this adding to the amount owed
depreciation
assets lose value over time, accountants use depreciation to spread out the costs of an asset over its useful life
- it is a paper exercise to match the costs of an asset against the time its used in a business
- straight line
- reducing balance
discount allowed
reductions offered to customers reduce the amount of cash flow into a business so are considered as an expense
