Clickstream

Capital vs. Expense

It was pointed out that my last post contains an error because escorts are an expense, and therefore can't come out of the capital budget. I know that for tech companies at least, this is not the case.

I know this because I know of a sales rep years ago in my region who had recurring $150 charges on his expense report when travelling. The finance department finally followed up with a phone call to the company in question and discovered the nature of the business transactions. The rep was fired. This implies that it's a capitalized cost, and not to be expensed under any circumstances.

This is because many tech companies capitalize their labor.

Posted by Mark Wednesday, July 21, 2004 9:34:00 PM | permalink |