Entrepreneurship and Small Business (ESB) Certification Practice Exam

Which of the following is an example of a one-time expense that businesses may incur?

1. Advertising costs

2. Merchandising costs

3. Business plan development

4. Utilities

The correct answer is: Business plan development

In the context of business expenses, a one-time expense refers to a cost that is not recurring and is typically associated with a specific project or activity. The correct answer, business plan development, fits this definition because creating a business plan is often a unique undertaking for a business, especially when starting up or launching a new venture. This expense is generally incurred once and does not repeat regularly as other operational costs do. On the other hand, advertising costs are usually ongoing as businesses promote their products or services continuously to attract customers. Merchandising costs can also be recurrent, as they involve ongoing activities related to selling and displaying products, which a business may incur repeatedly over time. Utilities, like electricity and water, are regular monthly expenses that businesses incur continuously as part of their operational requirements.