Which of the following is NOT typically included in an operating budget?

An operating budget typically includes ongoing expenses necessary for the day-to-day functioning of an organization. Salaries and benefits, utility bills, and preventive maintenance are all regular operational costs that need to be covered to keep the organization running smoothly.

Salaries and benefits represent the compensation for employees, a major expense that is predictable and consistent from month to month. Utility bills cover essential services such as electricity, water, and gas, which are also recurring costs necessary for operations. Preventive maintenance is crucial for ensuring that equipment and facilities remain in good working condition to minimize the risk of unexpected failures.

In contrast, large equipment purchases are not included in an operating budget because they are typically one-time capital expenditures. These purchases are usually budgeted separately in a capital budget, which accounts for long-term investments in assets rather than regular operational costs. This distinction is key to effective financial management in any organization, as it allows for better planning and allocation of resources for both immediate operational needs and future capital investments.