Expenses

“ Such expenses need not relate directly to the production of income for the business. It is enough that the expense, if 'ordinary and necessary,' is directly connected with or proximately results from the conduct of the business. ”

“ Accrued Expenses represent usually the accumulating but unpaid claims against the business for service rendered it, as distinguished from the Accounts Payable, which usually represent purchases of an asset of one kind or another. Thus the amounts due at a given time to employees for work done since the last date of payment of their wages, salaries, or commissions, to the landowner for the rent of leased premises, to lenders for interest on moneys borrowed, are items properly to be listed under this title. ”

“ These expenses usually comprise such costs as state incorporation fees, attorney’s fees for drawing up the application and other papers, the cost of prospectuses, soliciting costs for stock subscriptions, fees paid promoters and organizers, cost of printing and issuing certificates of stock, cost of capital stock records, and similar items. These are necessary and unavoidable expenses without which the company cannot come into being. A company organized and ready to commence business is in a better position than one whose elements have not been brought into harmonious working. ”

“ Even you, Monsieur Gagnon, could look into the future on those terms. When the expenses exceed the income, what takes place? One pays out all one's ready money, one borrows, sells a cow, a horse, a piece of land. ”

“ Profits are always a surplus. They are the difference between the cost of production or acquisition and the selling price.” He summarizes expenses of production as including cost of raw materials, wages, rent, interest on capital borrowed or invested, taxes, and miscellaneous outlays such as insurance, advertisements, and transportation expense. Again, he says: [55] “Income is that which comes in to an individual above all necessary expenses of acquisition and which is available for his own consumption.” He recognizes depreciation as a necessary expense. ”

“ There are certain expenses connected inseparably with the construction of any public work, which, on the completion of that work, are not capable of physical identification, but which, nevertheless, belong to and must be a part of the cost of the physical property. These expenses are legitimate; and, as long as the property is operated, a very large part, if not all, of the entire expense remains in the present value of the property as a "going concern." ”

“ Certainly, if a man will keep but of even hand, his ordinary expenses ought to be but to the half of his receipts; and if he think to wax rich, but to the third part. ”

“ Take care that you know definitely what sum you can afford to spend on your household expenses, and make it a point of conscience never to exceed it. Market with ready money, if possible; but, if it is more convenient to pay by the month, or quarter, never make that an excuse for letting your bills mount up to double what you can afford to pay. With accounts, carefully kept, it is quite possible to regulate the expenditure to the income. ”

“ The principal function of the term 'ordinary' in § 162 (a) is to clarify the distinction, often difficult, between those expenses that are currently deductible and those that are in the nature of capital expenditures, which, if deductible at all, must be amortized over the useful life of the asset. ”

“ It is an excellent plan to have a set of rules for regulating the ordinary expenses of a family, (such as are given in the Appendix to the practical economy,) in order to check any innovation or excess, which otherwise might, unawares, have occurred to derange the proposed distribution of the annual income. ”

“ It must be considered that any uncommon expense, as the loss of a horse or the like, may occasion an extra draft over and above the allowance. I like very much your methodical arrangement as to expenses; it is rather a tiresome thing at first to keep an accompt of pounds, shillings, and pence, but it is highly necessary, and enables one to see how the money actually goes. ”

“ A small change in such items often makes a large difference in the total. There is not much trouble about general expenses, legal expenses, engineering, etc., as these are undoubtedly proper items to be added, and the amounts of the percentages are not difficult to determine from sufficient study of the property. ”

“ When you have taken interest on the loan, the cost of food, the wages of Pauline La Chance, the hired girl, and all the other expenses, what will be left to pay for the work of Madame Giroux and Jean himself, not to mention a thousand little items, of no account in themselves but great in the aggregate. Oh, I know arithmetic, I assure you, as well as many other things. It is useful, at times, to be able to count. ”

“ Certain deductions can be made in calculating income—such as working expenses, office expenses, pensions and other burthens, amounts paid for direct taxation, dues to commune and church, tithe, tenant and farming charges, heirs’ allowances and similar burthens ”

“ A larger proportion of the expenses of production goes for the purchase of equipment and raw materials, and a smaller proportion—though perhaps an [Pg 426] absolutely increased amount—goes for the purchase of labor power. ”

“ Being able to buy food where it is grown, cuts down expenses to a very small amount comparatively. When I told them this, one of them acknowledged that he could see that they would have less expense, but that they would still have need of money. ‘You bind us to take all we earn in scrip or shares for our labor?’ one of them asked of me. ‘Certainly,’ I said, ‘that is the protection of the society.’ But I told them they could buy money with their scrip. ”

“ The expense of feeding the Poor will be provided for by selling the portions of Food delivered from the public kitchen at such a price, that those expenses shall be just covered, and no more:— so that the Establishment, when once completed, will be made to support itself. ”

“ In his calculation, whether he shall employ it or not, he considers only whether the price of raw produce is sufficient to replace his expenses and profits, for he knows that he shall have no additional rent to pay. ”

“ Suppose the income of an individual to be one thousand dollars, and his expenses eight hundred, two hundred would be his surplus applicable to the attainment of a balance of trade, and if so applied would draw from foreign nations money or property to that amount. ”

“ To appreciate the full magnitude of this stroke, consider these other figures: the annual expenses of a national government amount to the equivalent of a contribution of three days' average wages of every individual of the population, counting every individual as if he were a man. If you take a nation of 60,000,000, where average wages are $2 per day, three days' wages taken from each individual will provide $360,000,000 and pay the government's expenses. ”

“ By cost to make is meant full cost, which includes materials used, labor applied, and a fair share of the overhead expenses. Whatever the cost to make, whether lower or higher than the identical equipment could be purchased for on the market, that represents the capital outlay and is the true basis for valuation, taking cognizance of depreciation for the elapsed period. ”

“ Where the employer has been accustomed to pay to the workman a sum to cover any special expenses entailed on him by the nature of his employment, the sum so paid shall not be reckoned as part of the earnings. ”

“ Every increase of business would enable the whole to be carried on with a proportionally smaller amount of labor.
As a general rule, the expenses of a business do not increase by any means proportionally to the quantity of business. ”

“ And this larger balance would be drawn, upon for the extra expenses, such as entertaining and amusements, charities, and the thousand and one pleasant ways of spending money that are open to the possessor of the larger income, and are rigorously out of the reach of the owner of 500l. ”

“ Of course I can't give exact figures, as it would be hard to get at them, because you know each mercantile enterprise, each selling shop, each sewing shop, has its own income and expense account, just as each family has its own degree of economy in incurring expenses with special proportions between their various expenditures. ”

“ The active prioress of St Mary de Pré, Christian Bassett, classifies her payments as for (1) “comyns, pytances and partycions,” (2) “yerely charges,” (3) “wagys and ffees,” (4) “reparacions,” (5) “divers expensis.” Dugdale, Mon. III, pp. 358-61. The prioress of Catesby (1414-5) classifies (1) rents, (2) petty expenses, (3) expenses of the houses (i.e. repairs) , (4) household expenses, (5) necessary expenses (miscellaneous) , (6) expenses of carts, (7) purchase of livestock, (8) customary payments (to nuns, pittancers, farmers, cottagers, etc. in clothing; details not given) ”

“ As the income during these thirteen days had been so small, our means were again reduced to 16s., after I had supplied the day before yesterday the means for the house-keeping expenses for this week. Today I received information, that to a sister in Switzerland had been given Fifty Francs for the Orphans. Thus the Lord is in every way showing that He is mindful of us.
April 29. Saturday. The expenses of today, in addition to those for house-keeping, which had been met last Tuesday evening for a whole week in advance, reduced our little stock of means to only a few shillings. ”

“ The investment is made on the faith of a profit, the profit accrues from the balance left after deducting expenses from the product of the rates, and the assumption is that the operation is economical and the expenditures are reasonably necessary. ”

“ The manufacturing cost formula comprises the three items of: (1) raw material consumed, (2) direct labor applied, and (3) factory expenses incurred, this latter item sometimes called overhead expenses. When a concern operates a detailed cost system, the valuation of the finished product is not difficult, being the goal towards which the system works. Where no cost system is used, great care must be exercised to make sure that every item of cost is calculated as accurately as possible and that a proportionate share of such costs is applied to the finished product still on hand unsold. ”

“ For expense of stationery and printing, and contingent expenses of the revenue office, including the sum of five thousand three hundred and twenty-five dollars seventy-three cents, the amount of expenditures for these objects during the year one thousand eight hundred and thirteen, for which no appropriation has been made, nine thousand nine hundred and seventy-eight dollars and thirty-six cents. ”

“ The economy still follows the absolute height of the expenditure. Later on when the volume of business has increased, the importance of the business expenses dwindles; increases in the expenditure totals matter little so long as the transactions and returns can be sufficiently increased. ”

“ Moreover, the settled prices prevailing throughout the country allow of assured calculations and precautions as to business ventures, and permit such a ratio to be established between expenses and income, that at the end of the fiscal year a profit, not a loss, may be counted upon. ”

“ It isn’t conventional, or even good form, to pry into a man’s finances, but we shall probably be going about together, more or less, during your stay, and in such a case I always like to know how a man stands in regard to expenses. ”

“ If we deduct from the final value not only the materials purchased but also the miscellaneous expenses reported by the census, none of which represent values created in these industries, the proportion received by the laborers advances to about 65 per cent. ”

“ His income was about 2,300l. a year, which probably does not include all that he received by way of gift. But on his various retinues of servants he spent no less than 1,500l. a year, and as the margin had to meet all such expenses as his journeys to the court, and as he was extraordinarily magnificent in taste, he was soon in debt. ”

“ Amounts sufficient to create a reserve balance that is the same percentage of total cost of depreciable items as their age is of their total service life cannot be accepted as legitimate additions to operating expenses. ”

“ Of Economy in Expenditure.—Economy should be the first point in all families, whatever be their circumstances. A prudent housekeeper will regulate the ordinary expenses of a family, according to the annual sum allowed for housekeeping. ”

“ LXX. To provide for all common expenses, any balances of the preceding year are first of all employed, and likewise the common revenues derived from the duties, the common consumption taxes, and from the postal and telegraph services. ”

“ From a donor in Bristol 5l. From Norwich 5s.—Thus we have wherewith to meet the expenses for today and tomorrow, and, it may be, of the day after tomorrow. At all events, before this is gone, the faithful Lord will send in more.
Nov. 4. By sale of old clothes 11s. 2 1⁄2 d.—From Whitby 1l. Ditto 5s.—From Bodmin 1s.—By sale of rags 7s. 3d. [I transcribe from the Income book. We think it right to turn every thing to account, so that nothing be wasted, and that the expenses of the Institution be not needlessly increased.] ”

“ The decrease of revenue arising from the situation of our commerce, and the extraordinary expenses which have and may become necessary, must be taken into view in making commensurate provisions for the ensuing year ”

“ This amount is intended to cover all the expenses of the Ruler and his family including expenses of account of his personal staff, maintenance of his residences, marriages and other ceremonies, etc., and will neither be increased nor reduced for any reason whatsoever. ”

“ If ye keep your expenses as at present, and increase your sales, all the profit on the excess business above your quota is porridge. Ye dinna hae to pay any additional amount for rent, taxes, heat, light, depreciation, advertising, or insurance. In other wor-rds, your operating expenses on all business, over and above your sales quota, are reduced by these items. This saving would reduce your operating expenses eight per cent., meaning that this excess business over your quota would only cost ye twelve per cent. to secure, instead o' twenty per cent. ”