Business expenses are the costs incurred in the day-to-day operations of a company. Expenses can be categorized into five main groups: production costs, administrative costs, marketing and sales costs, capital costs, and financing costs. Production costs are related to creating a product or providing a service – they include raw materials, labour, shipping and warehousing costs, among others. Administrative costs cover the everyday needs of running a business, such as office rent, supplies, telecommunications and utilities. Marketing and sales costs centre around activities that generate revenue, such as advertising and promotion. Capital costs are associated with long-term investments made by the business, including equipment purchases and property acquisitions. Finally, financing costs cover interest payments on loans and other forms of borrowing. Understanding business expenses is key to making sound financial decisions.