Capitalized Costs: Capitalized costs are expenditures that are recorded as assets on the balance sheet, as they provide a future economic benefit to the organization. These costs are then depreciated or amortized over their useful life.
Expenses: Expenses are the costs incurred by a business in the process of generating revenue. They are recorded on the income statement and represent the resources consumed in the operation of the business.
Operating Costs: Operating costs are the expenses incurred in the day-to-day operations of a business, such as rent, utilities, and administrative expenses. These costs are necessary for the business to function and generate revenue.