To activate expenses, you must have the Accounting/Bookkeeping module activated. To do so, go to Setup > Preferences > Modules. Check the Accounting/Bookkeeping box, then click the Save Changes button.

How to enter a new bill or expense

An expense can be a 'Pending Expense' (referred to as a 'Bill') or an Expense Paid.
From the main menu strip at the top, go to Expenses > New Bill, or Expenses > New Expense.
Note: The only difference is the 'Expense Type' dropdown at the top of the expenses screen. This can be switched from Pending Expense to Expense Paid at any time.
Select the supplier for the expense. If you start entering the supplier into the Supplier dropdown you will see a '+ New Supplier' button if the supplier does not exist. This allows you to create a new supplier on the fly.
For existing suppliers, the last few expenses paid to the supplier are shown in a list just below the supplier field to help you avoid doubling up expenses.
The 'Payment Date' is the date you paid or expect to pay the expense.
The 'Date Received' is the date you received the bill. This date is used for accrual based reporting.
Ensure you enter the Tax Code. In some cases, particularly overseas purchases, you may need to use the 'Manual Tax Entry' option to manually enter a tax value rather than use the tax codes.
A single Expenditure Account can be selected for the expense, or you can use multiple expenditure accounts by clicking the 'Split' button to the right of the Expenditure Account dropdown. The total of the split expenditure accounts must equal the total for the overall expense.
You can link the expense to an existing Purchase Order, or expenses can even be created from the Purchase Order screen.
Reference Number is generally the bank receipt number or cheque number if using cheques.
Enter a reason for the expense in the Memo field to assist with tax claims.
Click 'Save New' button at the bottom of the screen when completed.

Orders/Expenses (Overview)

Orders/Expenses (Overview)