what is revenue expenditure

Revenue expenditure refers to the funds that a company spends to ensure routine functioning and generate revenue in a given accounting period. It includes all the expenses that are required to meet the current operational costs of the business, such as salaries, employee wages, rent, utilities, business travel, property taxes, and marketing expenses. Revenue expenditures are short-term business expenses that are usually used immediately or within one year. They are recorded on the income statement and are subtracted from the revenue that a company generates from sales to eventually arrive at the net income or profit for the period. Revenue expenses can be fully tax-deducted in the same year the expenses occur, which reduces the taxable income for the tax period. Revenue expenditures are different from capital expenditures, which refer to any money spent by a business for expenses that will be used in the long term.