Administrative expenses

Administrative expenses are those expenditures associated with the general oversight and operation of a business. Examples of administrative expenses are:

  • Accounting and finance compensation and benefits
  • Corporate compensation and benefits
  • Corporate rent and other facility costs
  • Depreciation on corporate fixed assets
  • Human resources compensation and benefits
  • General liability insurance
  • Information technology compensation and benefits
  • Office supplies

Administrative expenses are classified as period expenses, so they are charged to expense as soon as they are incurred. If a business is operating under the cash basis of accounting, then these items are charged to expense when paid.