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Expense budget planning is an important part of any budget. An expense budget is a list of forecasted expenses within a set amount of time. An expense budget could cover a quarter, an entire year or just a month.
DEFINITION of 'Expense'. 1. The economic costs that a business incurs through its operations to earn revenue. In order to maximize profits, businesses must attempt to reduce expenses without also cutting into revenues. Because expenses are such an important indicator of a business's operations, there are specific accounting rules on expense recognition. 2. Money spent or costs incurred that are tax-deductible and reduce taxable income.