Understanding Expenses vs Liabilities: Key Differences and Their Impact on Business Finances
2020-08-03
When an expense is incurred, it is subtracted from the company’s revenue to determine the company’s gross profit or operating income, depending on the nature of the expense. Ultimately, expenses reduce the company’s net income, which is the final figure after all revenues and expenses have been accounted for. Current liabilities are usually paid with current assets; i.e. the money in the company’s checking account. Rent Managing short-term debt and having adequate working capital is vital to a company’s long-term success. If you have digital asset transactions, you must report them whether or not they result in a taxable gain or loss. Expenses are costsRead More →