What is an expense?

What is an expense?

• A. Money you earn from work.
• B. A loan payment you make every month.
• C. The amount you owe after borrowing.
• D. Money you spend on something you buy or pay for.

Answer: (D)

An expense is money you spend on something you buy or pay for. It’s what you use your money for when you buy things or pay bills, like groceries, clothes, or a monthly internet bill. Expenses reduce the cash you have on hand and are a normal part of budgeting. This is different from income, which is money you earn from work or other sources. It’s also different from debt or amounts owed—like a loan payment you make each month, or the total you owe after borrowing—which are related to borrowing and interest, not the everyday spending you do to buy things.

An expense is money you spend on something you buy or pay for. It’s what you use your money for when you buy things or pay bills, like groceries, clothes, or a monthly internet bill. Expenses reduce the cash you have on hand and are a normal part of budgeting.

This is different from income, which is money you earn from work or other sources. It’s also different from debt or amounts owed—like a loan payment you make each month, or the total you owe after borrowing—which are related to borrowing and interest, not the everyday spending you do to buy things.