| Expenses
and Losses |
| Operating
Expenses |
| Operating expenses include expense accounts
that are necessary to earn operating revenues. |
 Cost of sales (or cost of goods sold)
Selling, General and
Administrative Expenses (SG&A Expenses) |
| Selling, General and Administrative Expenses
include the following accounts. |
Salaries expense
Sales salaries expense (Salaries
expense for sales personnel)
Insurance expense
Property tax expense
Rent expense
Utilities expense |
| |
| Nonoperating
Expenses and Losses |
| Nonoperating expenses and losses include
expense and loss accounts that are due to the transactions other than the primary
operations of the company. |
Interest expense
Loss on sale of securities
Loss on sale of buildings
Loss on sale of machinery
Loss on sale of equipment |
| Interest expense account may be classified as
operating expenses for banks and other financial corporations, whose primary operations
are lending money to earn interest income. |
| |
| Losses from
Discontinued Operations |
| Losses from discontinued operations are due to
the disposal of business segment. |
Loss from operations of discontinued business segment
Loss on disposal of business
segment |
| |
| Extraordinary
Losses |
| Extraordinary losses include losses that
unusual and infrequent. |
Loss on early extinguishment of debt
Loss from fire
Loss from flood
Loss from earthquake |
| |
| Losses due to
Changes in Accounting Method |
| Cumulative effect of changes in accounting
method is reported as either gain or loss in the income statement of the current period. |
|
Cumulative effect of changes in depreciation method |
