Non Operating Expense Examples

Non operating expenses are those which are not related with the operation of business. Every businessman can do specific commercial activities. A business can not produce and sell of furniture and financial activities. All the activities which a businessman does for getting commercial benefits in his field will be his operating business. Its all expenses will be his operating expenses. But sometime, he gets also commercial benefits for the activities which are not related to his operation. All expenses which are not related to his operation will be his non operating expenses.

Now, we are ready to explain non operating expense examples.

1st : If You are Doing Business in Product Market

For example, you are doing the business of buying and selling the product of knife as whole seller. You buy knives at maximum quantity at very low price directly from manufacturer and sell at high quantity and at higher price to retailers. Your all business expenses are relating to this.

(A) Suppose, you have more business space which you want to give it to other party on rent. To give your space on rent and getting rent is your non operating business. For this, you can pay following non-operating expenses:

a) Repair of extra space.
b) Property tax on that space.
c) Supervisor's salary for caring that space.

(B) Suppose, you have earned good money in your business of selling knife. You want to invest it in financial market like buying of shares and getting its dividend. For this, you have paid following expenses. 

a) Demat Account Opening Fees.
b) Paying of Broker fees.
c) Loss on selling shares at low prices ( *Loss is also expenses because this expense is paid in current time but our capital is reduced due to any loss like reducing of capital due to paying of expenses).
d) Bank Charges for collecting your dividend automatically.

(C) Suppose, you want to invest in construction business. For this, you become partner of sham. You are sleeping partner. You invest only small  money for its operating expenses  and get 5% share of profit or loss. At that time, following will be his non operating expenses

a) Your invested small money expenses will be your non operating expenses

b) If same partnership suffers loss, at that time, you will get 5% loss. Excess of your loss over your invested small money is also your non operating expense.

2nd : If You are Doing Business in Financial Market

In financial market, you buy and sell the shares, debentures and other financial market like mutual funds and hedge funds. This is your business. You may also be financial company, bank and other financial organisation which collects money at low rate of interest and gives it at higher rate of interest. At that time, following will be  your non operating expenses

(a) Suppose, you buy some space and sell it at profit. Paying the expenses for buying this will be your non operating expenses.

(b) Suppose, you contract with other party for doing business of buying and selling of product. All its expenses will be your non-operating expenses.

3rd : If You are Doing Business in Service Market 

Suppose, you are CA. Your work is to provide the audit service to companies. But due to this profession, you can estimate the idea of profit in different companies. You contract with your wife. Your wife started business in higher profit industry like producing of soft drinks. You are paying its all operating expenses and getting earning from this business. These all operating expenses in soft drinks will be non operating expenses of your audit service business.


1. To knowing the difference between operating expenses and non operating expenses will be helpful for comparison by calculating operating expense ratio and non operating expense ratio. Our total sales will now divide into two parts. One is for paying operating expenses and other for paying non operating expenses.

2. From calculating taxable net profit, we deduct only operating expenses from our total business expenses. 






access account accountant Accounting accounting definitions accounting ebook Accounting education accounting procedure accounting process outsourcing Accounting Software advance advertising africa Amalgamation amendments announcements Annuity assets audit auditing Australia B.Com. balance sheet bank Bank reconciliation banking basic accounting BBA benefits best bill black money blog bloggers book keeping bookkeeping Branch Accounting - full tutorial budget Budget variance business businessman CA calculator canada capital capital budgeting career cash cash book cash flow statement Chiense children china class coaching coins college commerce commerce students company computer computer accounting conference Contact vinod kumar Control Your Spending corporate accounting cost cost accounting cost center cost centre CPA credit credit card cs currency data Debit and credit debit cards debt debtor degree depletion depreciation Diwali Messages documents dollar domain Downloads Dubai e-accounting earning education Education Loans email employee EPF ERP euromoney examination excel excise duty expenses facebook factor of loan fans feature fifo FII fiji finacle finance Finance Journal Entries Financial financial accounting fire insurance flickr flow forensic forex formula france fraud free fun function fund GAAP GDP gdr germany gold goodwill goodwill accounting google google apps Google Adsense google apps google base google buzz google calendar Google docs google finance google fusion tables google talk govt. GST guide health Hindi Hindi Language history holding company How to treat FBT in Tally 9 HRA ICAI ICAWI ICICI Bank IFRS income income statement Income Tax India indian railway Indonesia inflation inflation accounting infographics information inspiration insurance insurance accounting Intangible interest international Internet Introduction of Tally 9 inventory investment investment in Shares invoice IT Japan Job costing journal entries Journal Entries eBook Help Kalculate keyboard kindle kuwait laptop law LBT learning lease lecture ledger leducation Leverage Analysis liabilities lifo linkedin loan logical point loss loss of profit M.Com. m.phil malaysia management accounting manual accounting manufacturing account market marketing mastercard material MBA MCA media migration mobile money ms word ms. excel multi currency in tally 9 Multicurrency Accounting mutual fund national security new and sacrifice ratio new york times new zealand news NGO nonprofit-accounting North Georgia Mountains NPV NSE odbc office oman online application online accounting Online Accounting Course otcei pakistan parents Partnership pay pal pdf Personal Finance pie chart pie chart of income pnb podcast ppf presentation price privacy policy prize money prof. vinod kumar profit profit and loss account project management provision purchase puzzles quickbooks Quote quotes quotes of svtuition rating agency ratio analysis RBI readers real estate rectification of errors remote control reports reserves responsibility accounting retirement revenue Revenue reserves review risk rupees salary sale saudi arabia saving sbi scholarship school SEBI security service tax share share trading Shares shri lanka singapore sms social accounting society solution South Africa stock stock exchange structure student students study subsidiary company svtuition swiss bank tally tally 9 Tally 7.2 Tally 9 Tally.ERP 9 tanzania tax Tax Accounting TDS teacher teaching technology test testimonial testimonials thailand tips trading trading on equity transaction trend trial balance truthfulness tuition twitter UAE UGC - NET Commerce UK United Arab Emirates university usa valuation VAT Video Voucher and vouching Wealth wikipedia working capital youtube
Accounting Education: Non Operating Expense Examples
Non Operating Expense Examples
Accounting Education
Not found any lecture VIEW ALL Continue reading Reply Cancel reply Delete By Home PAGES Lectures View All RECOMMENDED FOR YOU Category ARCHIVE SEARCH ALL Lectures Not found any lecture match with your request, please help to write it and send it to our email at for making this website free accounting and finance encyclopedia. Back Home Sunday Monday Tuesday Wednesday Thursday Friday Saturday Sun Mon Tue Wed Thu Fri Sat January February March April May June July August September October November December Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec just now 1 minute ago $$1$$ minutes ago 1 hour ago $$1$$ hours ago Yesterday $$1$$ days ago $$1$$ weeks ago more than 5 weeks ago Followers Follow THIS CONTENT IS PREMIUM Please share to unlock