What are costs?

Definition of costs

Costs, in the context of running a business, are what an organisation has to pay for.

Nearly every business will have to 'spend money to make money'. For instance, a business will nearly always need a website. That website will need to be built and the developer who builds the website will usually charge a fee for his or her services. This fee is a cost.

A business's costs may be day-to-day running costs, such as paying for electricity to light or heat the business's premises, or they may be larger, one-off costs, such as buying a new computer or new desk.

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FreeAgent's Chief Accountant Emily Coltman is available to answer your questions in the comments.