Question

Which category do items like property tax, fuel, metered utilities, insurance, rent, and condominium fees fall into when considering expenses related to a property?

A) Maintenance expenses
B) Operating expenses
C) Capital expenses
D) Transactional expenses

Answer 1

Property tax, fuel, metered utilities, insurance, rent, and condominium fees are categorized as Operating expenses which are necessary for the day-to-day running of a property.

Step-by-step explanation:

Items such as property tax, fuel, metered utilities, insurance, rent, and condominium fees fall into the category of Operating expenses when considering expenses related to a property. These are the costs that must be paid out regularly to maintain the functionality of a property, business, or investment. Operating expenses include a variety of costs that are essential for the day-to-day running of a property and can also include costs such as repairs and maintenance, however, they should not be confused with capital expenses which are typically large one-time investments that improve the value of the property or extend its life.