What sort of expense is the cost of renting a coffee machine for a coffee shop?

[Quora]

If you rent a coffee machine for a coffee shop business, is this rent a direct expense or an indirect expense?

 

[AnneLou]

I'm not sure about direct and indirect expenses - I'm not fully trained! But, I would say this is just an expense. I own pub/hotels and would classify this item as Machine Rent and show in my Expenses.

Buying the beans to grind for coffee or milk to put in the drink - are classed as Cost of Sales in your accounts. Without those things, you couldn't make coffee to sell. It could be argued that you couldn't make coffee "properly" without the machine - but you could make do!

So, Sales less Cost of Sales gives you gross profit. Then a big long list of Expenses are deducted to give you Net Profit. With a bit of luck HMRC will leave you a pittance to live on whilst subsidising Amazon and Google!

Take no notice of my grumpy attitude - I'm just waiting patiently for retirement!

 

[Scalloway]

I would class it as an overhead.

 

[Energise Accounting]

The correct way to treat the item is a overhead, As it is a piece of machinery used to produce the coffee.