Loan Ready · In plain language
These are the regular costs of running your business each month: rent, wages, supplies, utilities, insurance, marketing and so on. Use the same time period you used for revenue.
Don't include loan payments here. There's a separate question for those.
What's left after expenses is the money available to repay a lender. Leaving costs out makes the business look stronger than it is, and lenders will usually spot it.
Costs that only come up once or twice a year, like insurance or licence fees, count too. Divide them by 12.