What are discretionary expenses? what is the importance of discretionary expenses for analysis of earnings quality?

A discretionary expense is a cost that is not essential for the operation of a home or a business. For example a business may allow employees to charge certain meal and entertainment costs to the company to promote goodwill with employees.The importance of discretionary expenses for analysis of earnings quality is to benefit the current year's reported earnings the long run impact on the firm's operating profit may be detrimental and thus the quality lowered.

The answer is price.