An expired cost is a cost that has been recognized as an expense. This happens when an entity fully consumes or receives benefit from a cost (sometimes resulting in the generation of revenue). An expired cost may also be construed as the total loss in value of an asset. A cost for which a portion is still recorded as an asset and a portion has been recognized as an expense can be considered a partially expired cost.
For example, a company spends $10,000 to acquire product catalogs, which it records as a prepaid expense in January. It hands out the catalogs during a trade show in March, at which point it charges the $10,000 cost to marketing expense. The $10,000 becomes an expired cost in March.
As another example, a company pays $100 for office supplies in June. Though the supplies may not be used for several months, it is not worth the time of the accounting staff to recognize such a small cost over several reporting periods. Instead, the $100 is charged to expense as incurred, which means it is an expired cost in June.