Which of the following is an example of operating expenses?

Operating expenses refer to the costs that a business incurs during its normal operations to generate revenue. These expenses are often ongoing and necessary for the day-to-day functioning of the business. Rent and utility bills are prime examples of operating expenses because they are required regardless of the sales or production levels.

Rent is the cost associated with leasing business premises, and utility bills cover essential services such as electricity, water, and heating, which support daily operations. Both contribute directly to maintaining the space where business activities occur and are incurred frequently, making them fundamental to the operating budget.

In contrast, revenue from sales pertains to the income generated from selling goods or services and does not represent an expense. Cost of goods sold refers to the direct costs tied to the production of goods sold by a company, while loan repayments concern financing and are not categorized as operating expenses since they do not pertain to the core operations of the business. Thus, identifying rent and utility bills as operating expenses accurately reflects the nature of ongoing costs necessary for business operations.