30 JUN 2017 About EXPENSE BUCKETS 0 Why Expense "Buckets"? When projecting, it is easier to group expenses into 5 major categories, or "buckets". Variable expenses are a percent of sales; the monthly dollar amount rises and falls as sales fluctuate. Fixed expenses average essentially the same dollar amount each month. (If you've not yet set up these categories on your P&L, use the SPEEDY Expense Analyzer.) VARIABLE EXPENSES SELLING Expenses - Examples: Store payroll, including taxes and benefits; Advertising; Bags & boxes; Special events; etc. FIXED EXPENSES OCCUPANCY Expenses - Fixed expense, essentially flat $ amount each month Examples: Rent; Utilities; Maintenance; Security; CAM charges; etc. ADMINISTRATIVE Expenses - Fixed expense, essentially flat $ amount each month Examples: Management salaries (Owner; General Manager; Buyer) including taxes and benefits; Support staff/services (bookkeeping; IT; warehouse; marketing); Interest on borrowed money; Professional services (legal, accounting); Training; Travel; All other expenses not included elsewhere. TAXES - Federal, State, Local taxes not included elsewhere. DEPRECIATION/AMORTIZATION - Fixed expense, essentially flat $ amount each month. These are non-cash expenses, and must be kept separate in order to project the Cash Flow.