92 HASKINS & SELLS December
The Expense of Borrowed Money
ON E of the well-recognized principles
underlying the statement of financial
operations is that it shall show the true
cost of goods, services, or privileges sold,
together with the expense of conducting
and of financing the enterprise. If a fine
technical distinction in the use of terms
may be made, cost usually refers to the
product, or to physical property; expense,
to an activity or phase of operation. Hence,
reference is made variously to manufacturing
cost, marketing cost, cost of property,
selling expense, administrative expense,
or interest expense. Used in the
