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Income And Expenditure
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Every business will have money coming in and money going out. These transactions must be recorded and controlled. Before we consider the methods of control, let’s first have a look at some of the transactions that are classified as income:
- Sales
- Rentals from property
- Interest received from Investments
- Money received from debtors
- Discounts received
A business will receive most of its income from the sale of its products. Other sources of income may vary according to the type of business and the amount of capital/money available for investment etc.
Now, let’s have a look at a few transactions that would be classified as Expenditure:
- Payment of Rentals
- Payments to Suppliers
- Tax
- Salaries and Wages
- Vehicle expenses
- Telephone and Postages
- Licences
Obviously, there may be many more payments, but they would also vary according to the type of business.