Costs and revenues

Costs and revenues are charged on accounts under accounting classes 5 – Costs and 6 – Revenues.

Costs can be defined as inputs into economic activity of the enterprise. Their aim is to be
transformed into outputs giving the sense to spent outputs.

Revenues are the outputs from economic activity of the enterprise.

The difference between revenues and costs is the economic result.

Costs and revenues can be divided into three basic groups:

1.     Operating costs (accounting groups 50 – 55) – examples: consumed material, consumed
services, depreciation, personal costs, etc., and operating revenues (accounting groups 60 – 64) –
examples: revenues from sale of goods, products, services, etc.

2.     Financial costs (accounting groups 56 – 57) – examples: paid interests, paid fees, etc. and
financial revenues (accounting group 66) – examples: cashed interests, cashed dividends, cashed
fees, etc.

3.     Extraordinary costs (accounting group 58) – examples: damages, costs resulting from changes
in accounting procedures, etc., and extraordinary revenues (accounting group 68) – examples:
revenues resulting from changes in accounting procedures, insurance benefits, etc.

Costs and revenues must be charged in accounting period they are timely related to.