Which of these is not an expense type item?Group of answer choicesBank chargesCost of salesDividends paid to shareholdersDepreciation

Breakdown the Problem

1. Identify the different types of items listed in the options.
2. Determine which of these items is classified not as an expense.

Relevant Concepts

• Expenses are the costs incurred to operate a business, such as costs of goods sold, operational expenses, and so forth.
• Dividends are distributions of profit to shareholders and do not count as business expenses.

Analysis and Detail

1. Bank Charges: These are fees paid for bank services, which are considered operating expenses.
2. Cost of Sales: This represents the direct costs attributable to the production of the goods sold, classified as an expense.
3. Dividends Paid to Shareholders: These are payments made to shareholders as a return on their investment, not an operational cost.
4. Depreciation: This is an accounting method for allocating the cost of a tangible asset over its useful life, thus classified as an expense.

Verify and Summarize

After analyzing the definitions and classifications of each item:

• Bank Charges, Cost of Sales, and Depreciation are all considered expenses.
• Dividends paid are not considered an expense; they are distributions of net income.

Final Answer

Dividends paid to shareholders is not an expense type item.