Which expense category would typically be used to classify expenses that are related to delivering program services?

• A. Management and general
• B. Fundraising
• C. Program services
• D. Support from government

Answer: (C)

Focusing expenses by function reveals what resources are used to carry out the entity’s programs. When costs are directly linked to delivering program activities—such as staff working on a specific program, materials used for that program, or depreciation on facilities used to run it—that money should be shown under program services. This category captures the core activities the entity exists to perform.

Administrative and support costs belong to management and general, reflecting overhead needed to run the organization but not tied to a particular program. Fundraising expenses, if applicable, cover activities aimed at obtaining resources, not delivering programs. Support from government is typically recorded as revenue, not as an expense category, so it wouldn’t fit here.