Outlay là gì

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What Is an Outlay Cost?

An outlay cost is a cost incurred in order to exedễ thương a strategy or acquire an asphối. Outlay costs are also paid to lớn vendors lớn acquire goods such as inventory or services, such as consulting or software thiết kế. They are concrete expenses that are actually incurred in order khổng lồ achieve sầu a goal.

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Outlay costs are any costs incurred to acquire an asset or exexinh đẹp a strategy, but can also be costs paid lớn vendors for goods or services.For corporations, outlay costs for new projects include start-up, production, and asset acquisition costs.Outlay costs vì not include foregone profits or benefits—also known as opportunity costs. Total costs include both the outlay cost and opportunity cost.Outlay costs reduce earnings immediately with cash accounting, while with accrual accounting they are split across all periods the expense applies & matched to related revenues.

How Outlay Costs Work

Outlay costs are easy lớn recognize và measure because they have sầu actually been paid lớn outside vendors, as opposed lớn opportunity costs which are not actually incurred & paid to outside parties by the company.

For corporations, outlay costs for new projects include start-up, production, and asset acquisition costs. They can also include hiring costs for strategies or projects that require an addition to lớn the workforce in order khổng lồ be carried out.

Special Considerations

Outlay costs include the expenses paid by a business in order khổng lồ manufacture a sản phẩm or provide a service, & also include fees paid to lớn outside parties lớn acquire assets or services. In cash accounting, outlay costs immediately reduce earnings. In accrual accounting, outlay costs are split across all the periods that the expense applies khổng lồ and matched to related revenues.

Outlay costs vị not include foregone profits or benefits—such costs are known as opportunity costs & are hidden, but an important component of a business”s profitability.

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Outlay Cost vs. Total Cost

Outlay costs, sometimes referred khổng lồ as explicit costs, are direct expenses paid. These expenses can be one-time, such as repair bills, or recurring—e.g. subscription services. Direct costs can also be predictable, e.g. rent, or vary, such as utility bills.

Meanwhile, the total cost is both the outlay cost & opportunity cost. So while outlay costs include direct payment, total costs include any indirect losses or missed benefits. That is, opportunity costs are those benefits a business misses out on by choosing one option over another.

Example of an Outlay Cost

For example, if XYZ Manufacturing Company wants to purchase a new widget press they will not only have sầu to lớn pay for the widget press but for the fees associated with transporting the widget press to lớn their facility, as well as the costs for getting the widget press up and running & possibly expenses for training workers lớn use the new widget press. All of these are outlay costs associated with acquiring a new widget press.

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Then there are the implied costs of choosing one widget press over another. In addition, the other opportunity costs include choosing the widget press over another type of equipment or method.


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