Operating expense

An operating expense (opex)^[a] is an ongoing cost for running a product, business, or system.^[1] Its counterpart, a capital expenditure (capex), is the cost of developing or providing non-consumable parts for the product or system. For example, the purchase of a photocopier involves capex, and the annual paper, toner, power and maintenance costs represents opex.^[2] For larger systems like businesses, opex may also include the cost of workers and facility expenses such as rent and utilities.^[3]

Cite error: There are <ref group=lower-alpha> tags or {{efn}} templates on this page, but the references will not show without a {{reflist|group=lower-alpha}} template or {{notelist}} template (see the help page).

^ David Maguire, The business benefits of GIS : an ROI approach, 1st ed. (Redlands Calif.: ESRI Press, 2008), http://roi.esri.com/. ISBN 978-1-58948-200-5
^ Aswath Damodaran (1999). "Chapter 5 - Discussion Issues and Derivations". Applied Corporate Finance: A User’s Manual. John Wiley and Sons. ISBN 978-0-471-33042-4. Accountants draw a distinction between expenditures that yield benefits only in the immediate period or periods (such as labor and material for a manufacturing firm) and those that yield benefits over multiple periods (such as land, buildings and long-lived plant). The former are called operating expenses and are subtracted from revenues in computing the accounting income, while the latter are capital expenditures and are not subtracted from revenues in the period that they are made. Instead, the expenditure is spread over multiple periods and deducted as an expense in each period - these expenses are called depreciation (if the asset is a tangible asset like a building) or amortization (if the asset is an intangible asset like a patent or a trade mark).
^ Com, Netsuite. "Expense vs. Expenditure: What's the Difference?". Oracle Netsuite.

[2] David Maguire, The business benefits of GIS : an ROI approach, 1st ed. (Redlands Calif.: ESRI Press, 2008), http://roi.esri.com/. ISBN 978-1-58948-200-5

[3] Aswath Damodaran (1999). "Chapter 5 - Discussion Issues and Derivations". Applied Corporate Finance: A User’s Manual. John Wiley and Sons. ISBN 978-0-471-33042-4. Accountants draw a distinction between expenditures that yield benefits only in the immediate period or periods (such as labor and material for a manufacturing firm) and those that yield benefits over multiple periods (such as land, buildings and long-lived plant). The former are called operating expenses and are subtracted from revenues in computing the accounting income, while the latter are capital expenditures and are not subtracted from revenues in the period that they are made. Instead, the expenditure is spread over multiple periods and deducted as an expense in each period - these expenses are called depreciation (if the asset is a tangible asset like a building) or amortization (if the asset is an intangible asset like a patent or a trade mark).

[4] Com, Netsuite. "Expense vs. Expenditure: What's the Difference?". Oracle Netsuite.

[a]

[1]

[2]

[3]