File Name: capital revenue and deferred revenue expenditure .zip
Doorsteptutor material for UGC is prepared by world's top subject experts: Get detailed illustrated notes covering entire syllabus : point-by-point for high retention. As a matter of fact, deferred revenue expenditure is capital expenditure. Because, it has both quality of revenue and capital items, so it is deemed as deferred revenue expenditure.
It is essential to distinguish revenue expenses and capital expenditure to prepare correct financial statements. The absence of these will lead to misleading results where no one can conclude anything. There is no firm rule for making distinction between capital expenditure and revenue expenses. Expenses may be of capital nature and capital expenditure may be of revenue nature. The expenditure, the benefit of which cannot be consumed or utilized in the same accounting period should be treated as capital expenditure. Expenditure incurred to acquire fixed assets, erection and installation charges, transportation of assets charges, travelling expenses directly relates to purchase fixed assets are covered in capital expenditure.
For example, under accrual or mercantile system of accounting even income earned but not received is treated as income. Capital expenditure 5. Multiple choice questions MCQs Chhavi sharma. Capital and revenue items. Deferred Revenue Expenditure is that expenditure which yields benefits which extend beyond a current accounting period, but no relatively a short period as compared to the period for which a capital expenditure is expected to yields benefits. The Going Concern Assumption allows the accountant to classify the expenditure as Capital Expenditures and Revenue Expenditures, capital receipts and capital revenues. Conversion into Cash: It can be converted into cash at any time as these are usually investments in assets.
Back to: Capital and revenue items quizzes Show your love for us by sharing our contents. Capital expenditure is defined in the Local Government Act as expenditure which, in accordance with proper accounting practices, falls to be capitalised. It is deferred revenue expenditure as the benefit will be derived over a … Recommended Articles. Normally, revenue expenditures are incurred for receiving or earning of income. Revenue expenses are short-term expenses to meet the ongoing operational costs of running a business. Multiple choice questions MCQs Chhavi sharma.
A] Capital expenditure. B] revenue expenditure. C] deferred revenue. D] miscellaneous. Create PDF files without this message by purchasing novaPDF printer.
He knows that it is important to distinguish between capital expenditure and revenue expenditure. Deferred Revenue Expenditure is revenue expenditure, incurred to receive benefits over a number of years say 3 or 5 years. Multiple choice questions MCQs Chhavi sharma.
If you want, you can use the sample documents provided in this article. Examples of Revenue expenditures Following are the important Items of revenue expenditure: All expenses incurred in the ordinary conduct of business, such as rent, salaries, wages, manufacturing expenses, carriage, commission, legal charges, insurance and advertisement, free samples, salaries, postage expenses etc. It is the process of causing a liability by a commodity. Extending a building. You may click the link to find Multiple choice questions Q.
Оно напоминало беззвучный выдох-далекое чувственное воспоминание. - Капля Росы… Крик медсестры гнал его прочь. Капля Росы. Беккер задумался.
Слабое сердце… да к тому же еще испанская жара. Не забывай и о сильнейшем стрессе, связанном с попыткой шантажировать наше агентство… Сьюзан замолчала. Какими бы ни были обстоятельства, она почувствовала боль от потери талантливого коллеги-криптографа.
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