Operating expense in simple words refers to those expenses which are incurred by a company in order to run the normal operations of the business of the company. Given below is the list of operating expenses –
- Salaries and wages to the employees of the company.
- Rent for the office premises or for the factory in which manufacturing is done.
- Office supplies like telephone, computers, stationary etc….
- Maintenance and repairs for the machinery if the company is in manufacturing business.
- Advertising and publicity expenses.
- Traveling expenses paid to various people, it does not include payment made for personal traveling.
- Raw materials required for manufacturing of finished goods.
- Hire and leasing charges if plant and machinery are taken on lease or hire.
- Power, fuel and heating charges.
Apart from above operating expenses there can be other expenses also added to the above list depending on the nature of industry in which company operates.