What type of expense involves contributions made to charitable organizations?

Donations are expenses that represent funds or resources given to charitable organizations or causes without expecting anything in return. These contributions are typically recorded as an expense in the financial records because they reduce the overall profit of an entity, reflecting its commitment to social responsibility and community support.

This type of expense is recognized for its potential tax benefits as many jurisdictions allow businesses to deduct donations from their taxable income, encouraging philanthropic efforts. Moreover, the distinction of donations from other types of expenses is important as they specifically relate to charitable acts rather than operational or service-related costs, which would fall into different categories like delivery van repairs or bad debts.