Expense...Cost....Expenditure the same or not?

In common language the terms expense, expenditure, and cost have similar meanings. For example when renting an apartment you might ask what the monthly utilities cost is or what are the monthly utility expenses? But in business (especially accounting) these terms represent three separate ideas.

Briefly,

• Expense - is the amount of an asset or resource consumed (measured in dollars) the outlay or payment of cash is not necessarily required
  
• Cost - is the amount of an expenditure that would or will be required to obtain or create something, though in the field of Economics it tends to have the meaning of Opportunity cost (which I won't get into here)
  
• Expenditure- refers to the outlay or payment of cash

Now that we have some working definitions lets put it together. To purchase a new car it will cost us $10,000 (Future expenditure required). When I bought the car I created an expenditure of $10,000 (cash outlay). I had to buy 6 months of car insurance, which cost $600 and it had to be paid in advance, requiring a $600 expenditure (future amount to obtain service/ cash paid for services now and in the future). I will expense $100 (1/6 of $600) each month for 6 months (consumption of resource, in this case the paid in advance insurance).

Now you have a rudimentary understanding of the differences bewteen Expense, Cost and Expenditure. There are probably thousands of examples I could provide and if you'd like more or any clarification please comment back!