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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.
An expense is a cost on the income statement that reduces net income, or profit. To expense an item means to report its cost on the income statement. Under the accrual basis of accounting, you must report an expense in the period in which the expense contributed toward generating revenue in your business.