Miscellaneous or sundry expenses refer to small or infrequent costs that are not assigned to any accounting category. For example if you made a budget to track your monthly expenses, you will have categories like Food, Rent, Transportation costs etc. If you spent some money on a gift for a friend’s birthday or went to the cinema to watch a movie, those costs will be classified as miscellaneous expenses.
In a Small Business, sundry expenses will include; costs such as lunch for prospects, birthday gift card for a client or staff, tips etc.
Due to the sheer nature of these types of expenses, individuals and business owners seldom pay any attention to it. As a result, it can become a sink-hole in a budget. The tendency to misuse funds and accrue them to miscellaneous is higher when there is no structure in place to substantiate our actions.
Reversing this trend can save you or your business a lot of money. Although not every cost can be easily categorized, you can put in place an acceptable threshold and level of detail to explain expenses accrued as miscellaneous.
Knowing that an explanation will be demanded for an action has generally been known to make people more deliberate about what they do. So the next time you want to veer off and make that impulse buy, stop and ask yourself if it’s really necessary and how you will account for it.
Be accountable to yourself and hold others accountable too; you will be surprised at the results.
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