Operating Expenses

Operating expenses are the costs that a business incurs during its normal day-to-day activities. This includes expenses such as rent, utilities, salaries, and office supplies. Essentially, these are the necessary spending that helps a company keep running and manage its operations. Unlike costs related to producing products or services, operating expenses do not directly generate revenue, but they are crucial for maintaining the business's functionality and overall health. Understanding these costs helps businesses manage their budgets and profitability effectively.