Answer to Question #186904 in Accounting for Milan

Question

Is an expenditure an asset, liability, or an expense? What type of account is it?

What is the difference between an Expenditure and Expense?

Thank you.

Answer 1

Expenditure is the cost of purchasing a fixed assets and it does not have any implication on the financial information.

The key difference between an expense and an expenditure is expenses recognizes cost consumption and it's recognized when the sale is also recognized while expenditure recognizes disbursement of funds.