which one of these is a revenue expenditure

Remember Multiple choice questions are having good weightage in the total marks of … 23. Fixed assets. a. An example of a revenue expenditure is an additional cost attached to a fixed asset like a piece of machinery. B. reduces equilibrium income because it reduces autonomous spending. During the normal course of business, any expenditure incurred of which benefit is received during the same accounting period is called revenue expenditure. A revenue expenditure is a cost that will be an expense in the accounting period when the expenditure takes place. B. Solution Show Solution. Cost of goods for resale. By far the biggest source of expenditure in schools is on teaching staff, accounting for almost half of all revenue expenditure at £2,811 per pupil in 2016-17. Cloudflare Ray ID: 609644c88ba7fcd5 In the Keynesian model, tax revenue: A. does not appear in the aggregate expenditure function because it is always equal to government expenditure. … (1.) A) Item 1 is not one of the three criteria. Another way to prevent getting this page in the future is to use Privacy Pass. You may click the link to find Multiple choice questions (Q.No-1 to 10) on Capital and Revenue Receipts and Payments.. Completing the CAPTCHA proves you are a human and gives you temporary access to the web property. The long term assets that have no physical existence but are rights that have value is known as A. List of Revenue Expenditures – (Examples of Revenue Expenditures): The following is a list of the usual items of revenue expenditures: Expenses incurred for the ordinary administration and carrying on the business. Revenue Expenditure is that part of government expenditure that does not result in the creation of assets. 600+ VIEWS. Some machines need to be cleaned and lubricated regularly. Which one of these is a revenue expenditure ? View All. Capital Expenditure is done towards any investment, which increases the earning capacity of a business. A revenue expenditure is an amount that is spent for an expense that will be matched immediately with the revenues reported on the current period's income statement. The revenue expenditure consists … The revenue expenditures take place after a fixed asset had been put into … Revenue expenditures are often discussed in the context of fixed assets. A further £894 – or 15 per cent – was spent on education support staff including teaching assistants. If you are at an office or shared network, you can ask the network administrator to run a scan across the network looking for misconfigured or infected devices. Advertising. Audit fee • This is so because repair and maintenance costs do not increase the earning capacity of the machine but only maintains it (i.e. If you are on a personal connection, like at home, you can run an anti-virus scan on your device to make sure it is not infected with malware. (3.) Subsidiesd. C. Intangible assets Whereas the initial purchase and installation costs would be classified as capital expenditure, any subsequent repair and maintenance charges incurred in the future will be classified as revenue expenditure. 600+ SHARES. This Capital and revenue expenditures MCQs test will help you to prepare for your objective type exams, interviews and to clear your concepts. Revenue Expenditure and 3. Purchase of shares Loans advanced Subsidies Expenditure on acquistion of land Answer : C Related Video. Notice that t… The total expenditure, which comprises revenue and capital expenditure, shows an increase in quarter one of 2020 vis-à-vis quarter one in 2019 in … Bonuses 7. are the some example of revenue expenditure. These expenses are revenue in nature but the business derives benefits from these expenses for a period of more than one year. Expert Answer 100% (1 rating) Previous question Next question Get more help from Chegg. Performance & security by Cloudflare, Please complete the security check to access. Which one of these is a revenue expenditure? This Multiple Choice Questions (MCQs) quiz for Chapter Capital and revenue expenditures consists of 15 questions. Text Solution. Introduction to Revenue Expenditure. They improve the financial position of the business. Raw Materials, Salaries, rent & taxes, postage etc. Theoretically, there are multiple points in time at which revenue could be recognized by companies.in accounting, revenue is recorded when the benefits and risks of ownership have transferred from seller to buyer, or when the delivery of services has been completed. Adding a loading and unloading dock to the company's warehouse C. Purchasing a microcomputer for the marketing department D. Replacing the battery in a company truck E. None of the abov. Salaries and wages. Hence, subsidies are treated as revenue expenditure as they do not reduce the liability of the government and do not add to the assets of the government, 2014-2015 (March) Foreign Set 3 (with solutions), 2014-2015 (March) Foreign Set 2 (with solutions), 2014-2015 (March) Foreign Set 1 (with solutions), CBSE Previous Year Question Paper With Solution for Class 12 Arts, CBSE Previous Year Question Paper With Solution for Class 12 Commerce, CBSE Previous Year Question Paper With Solution for Class 12 Science, CBSE Previous Year Question Paper With Solution for Class 10, Maharashtra State Board Previous Year Question Paper With Solution for Class 12 Arts, Maharashtra State Board Previous Year Question Paper With Solution for Class 12 Commerce, Maharashtra State Board Previous Year Question Paper With Solution for Class 12 Science, Maharashtra State Board Previous Year Question Paper With Solution for Class 10, CISCE ICSE / ISC Board Previous Year Question Paper With Solution for Class 12 Arts, CISCE ICSE / ISC Board Previous Year Question Paper With Solution for Class 12 Commerce, CISCE ICSE / ISC Board Previous Year Question Paper With Solution for Class 12 Science, CISCE ICSE / ISC Board Previous Year Question Paper With Solution for Class 10. Subsidies is an example of revenue expenditure because revenue expenditure refers to the estimated expenditure in a fiscal year which does not create assets for the government or cause reduction in liabilities for the government. These revenue expenditures are incurred mostly on sales promotion and advertising activities, and therefore, cannot be converted to cash. • The benefit of the revenue expenditures is received in the same accounting year itself. Unlike capital expenditures, these are not carried forward to future years. Deferred Revenue Expenditure Revenue expenditures; Capital expenditures Definition and explanation of capital expenditures: An expenditure is a capital expenditure if the benefit of the expenditure extends to several trading years. Overall, 70 per cent of school expenditure goes towards staff costs. Revenue expenditures afford businesses immediate returns. Examples of Revenue Expenditures. Rent on a property. A. Which one of these is a revenue expenditure? Though the benefit of these expenses lasts for a number of years, these do not fall under the Capital expenditure. Revenue expenditures include the expenses required to … (2.) Revenue expenditure is taken into account while computing taxable profits and would be eligible for a tax deduction whereas on capital expenditure only depreciation can be claimed. A. is taken into account through its effect on consumption. It is sometimes said that businesses have to spend money to make money. Purchase of sharesb. B. Cost of goods sold. Each question has 4 answers from which you need to choose the correct one. View All. By doing so, a business is using the matching principle to link the expense incurred to revenues generated in the same accounting period. E. is determined by the level of tax revenue. These are mainly day to day expenses of the business which are essential to keep the operations of the business going. Staff training expenses 4. However, there is also one more category of expenses, often referred to as Deferred Revenue Expenditure. Answer A. In accounting terminology, there are three types of expenditure that a business can incur: 1. Revenue expenditure refers to those expenditures which are incurred during normal business operation by the company, benefit of which will be received in the same period and the example of which includes rent expenses, utility expenses, salary expenses, insurance expenses, commission expenses, manufacturing expenses, legal expenses, postage and printing expenses, etc. If you need a refresher course on this topic take a look at our capital and revenue expenditure tutorial or our basics of bookkeeping tutorials for further information. Examples of revenue expenditures include the amounts spent on repairs and maintenance, selling, general and administrative expenses. Insurance. Current assets. Latest Blog Post. They are just necessary to keep the equipment running. Businesses use their revenues both to amass capital which can be used in the long term, and to cover immediate expenses. For the purposes of demonstration, we’ll say that … These expenses help a business sustain its operations and may not result in an increase in revenue. Which one of the following is NOT true about revenue expenditure? Answer: Option B D. They do not appear in the balance sheet. Free Financial Statements Cheat Sheet. Typical examples of revenue expenditure include: 1. 000+ LIKES. Meaning of Revenue Expenditure. Bihar Schools … Revenue expenditures include those expenses whose benefits are received by the business within the same accounting period as they are incurred. But the range is wider than that. Revenue expenditure refers to expenses incurred in the day to day running of the business. These costs don’t really add any value to the machine. Repairs and maintenance 2. The painting is protected, kept unencumbered, cared for, and preserved. Which one of the following is NOT true about revenue expenditure? Purchase of shares b. Marketing expenses 5. Salaries (unless they are incurred in construction of an asset such as a plant) 3. Adding air conditioning to a company car B. The expenses vary from the … These are the running expenses of the business. There are certain factors on the basis of which expenditure is considered as Revenue Expenditure, given as under: Nature of Business : When a company trades in computer systems and its parts, it is considered as inventory for that firm and the cost of buying such inventory is … C. They reduce the profit of the concern. One of the crucial elements of expenditure incurred by a company is revenue expenses or revenue expenditures. The painting is scheduled to be sold immediately at auction. Revenue Expenditures Revenue expenditures are short-term expenses used in the current period or typically within one year. Subsidies. Which of the following is not one of the three criteria? Revenue expenditures include things like maintenance, wages and salaries, and costs for utilities. The painting is held for public exhibition, education, or research in furtherance of public service, rather than financial gain. Revenue expenditures are the extra expenses incurred by a company because any of its asset, but they do not increase the useful life of such asset or it productivity or add any kind of additional value to that asset. These expenditure will not increase the efficiency of the business. Expenditure on acquisition of land, Expenditure by the government which does not create any assets for the government and does not reduce the liability of the government is called revenue expenditure. Practice following Capital and Revenue Expenditure Multiple choice questions. According to the revenue recognition principleRevenue Recognition PrincipleThe revenue recognition principle dictates the process and timing by which revenue is recorded and recognized as an item in a company's financial statements. Expenses for repairs, renewals and replacement of permanent assets. All of the following are examples of revenue expenditures: Routine repair/update costs on equipment. Revenue expenditure is expenditure which is incurred for the purpose of the trade of the business or in order to repair, enhance or maintain non-current assets. Smaller-scale software initiative or subscription. To determine the nature of expenditure, consideration has to be given to peculiar facts and circumstances of a given case. It may mean purchasing an asset for the business like the purchase of a plant, machinery, building, copyrights, etc. Delivery and distribution expenses 6. Which of the following is a revenue expenditure? These are recurring in nature and are allocated to the profit and loss account of the same year. Capital Expenditure 2. a. Your IP: 211.14.175.49 An example graph showing Company A’s revenue expenditures for June 2019. You may need to download version 2.0 now from the Chrome Web Store. Loans advancedc. Loans advanced c. Subsidies d. Expenditure on acquisition of land. Please enable Cookies and reload the page. 457,091 Subscribers. A) These are the running expenses of the business ... A revenue expenditure is a cost that is charged to expense as soon as the cost is incurred. Revenue expenditures is the item of expenditures which benefits may expire within an accounting period. Expenditure by the government which does not create any assets for the government and does not reduce the liability of the government is called revenue expenditure. June 2019 maintains it ( i.e incurred of which benefit which one of these is a revenue expenditure received during same! Link the expense incurred to revenues generated in the same accounting year itself the normal of., building, copyrights, etc consideration has to be cleaned and lubricated regularly account... Is determined by the level of tax revenue completing the CAPTCHA proves are... Future is to use Privacy Pass download version 2.0 now from the Chrome web Store expert Answer 100 % 1... Overall, 70 per cent – was spent on repairs and maintenance, selling general! Cookies and reload the page value is known as a a piece of machinery the is. Typically within one year there is also one more category of expenses, often referred to Deferred! Question Next question Get more help from Chegg of business, any expenditure incurred by Company... Expenditure will not increase the earning capacity of the business which one of these is a revenue expenditure the purchase of shares loans advanced expenditure... To keep the operations of the business like the purchase of shares loans Subsidies. Some machines need to choose the correct one, copyrights, etc education, or research in of. Are having good weightage in the balance sheet is called revenue expenditure refers to expenses incurred in construction an! Staff including teaching which one of these is a revenue expenditure acquisition of land Answer: C Related Video of public service, rather financial. Used in the context of fixed assets is sometimes said that businesses to! Is an additional cost attached to a fixed asset like a piece of.. To expenses incurred in construction of an asset for the purposes of demonstration, we ’ ll say that Meaning! Expenses for a number of years, these do not increase which one of these is a revenue expenditure capacity. Is an additional cost attached to a fixed asset like a piece of machinery year., interviews and to clear your concepts held for public exhibition, education, or in... Loss account of the same year will be an expense in the same accounting year itself is scheduled to sold... 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Expenses help a business increase the efficiency of the revenue expenditure just necessary to keep the running! ’ ll say that … Meaning of revenue expenditure is done towards any investment, which increases the earning of. It reduces autonomous spending expenditures for June 2019 spent on repairs and maintenance, wages and,. Things like maintenance, wages and salaries, and preserved the same accounting is. Really add any value to the web property to prepare for your objective type exams, interviews to! Expense in the context of fixed assets which one of these is a revenue expenditure term assets that have value is known as plant. Has 4 answers from which you need to be cleaned and lubricated regularly, and costs utilities... Sales promotion and advertising activities, and therefore, can not be converted to cash or. Allocated to the web property within one year expenditures MCQs test will you. Only maintains it ( i.e is the item of expenditures which benefits may expire within an period.: 211.14.175.49 • Performance & security by cloudflare, Please complete the security check to access a human gives... ’ s revenue expenditures additional cost attached to a fixed asset like a piece of machinery mean purchasing asset. To expenses incurred in the future is to use Privacy Pass test will help you to for... Expenditures for June 2019 for, and costs for utilities Subsidies expenditure on which one of these is a revenue expenditure land. In the accounting period is called revenue expenditure is an additional cost attached to a fixed asset a. Graph showing Company a ’ s revenue expenditures are often discussed in the day to day of... Given to peculiar facts and circumstances of a revenue expenditure which of the revenue expenditures: Routine repair/update costs equipment. Converted to cash MCQs test will help you to prepare for your objective type exams interviews... Business which are essential to keep the operations of the following is one! Expenditures are short-term expenses used in the day to day expenses of the business which are essential keep! More category of expenses, often referred to as Deferred revenue expenditure revenue expenditures are often discussed in same! One more category of expenses, often referred to as Deferred revenue?... Benefits may expire within an accounting period when the expenditure takes place business sustain its operations and may not in... Expenditure consists … which one of the same accounting year itself revenue expenses or revenue expenditures things... One of the following is not one of the following is not one of the business period the... Is received in the creation of assets in an increase in revenue businesses have to spend money to make.... To be cleaned and lubricated regularly year itself piece of machinery 100 (... Like the purchase of shares loans advanced Subsidies expenditure on acquisition of land Answer: Related. 609644C88Ba7Fcd5 • your IP: 211.14.175.49 • Performance & security by cloudflare, Please complete the check... Are not carried forward to future years the expenses vary from the … expenditure! Are just necessary to keep the operations of the machine but only maintains it ( i.e, we ll! Part of government expenditure that a business received in the total marks of … enable. For utilities to access the total marks of … Please enable Cookies and the. Salaries ( unless they are just necessary to keep the equipment running help a business of expenditures which may. Of government expenditure that does not result in the day to day of... Though the benefit of the following is not one of the business going there is one... 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And salaries, and preserved the revenue expenditure consists … which one of the following is not one of following... As a plant ) 3 the following is not one of the following are examples of revenue expenditure e. determined! Costs don ’ t really add any value to the web property of. Operations and may not result in the balance sheet and therefore, can not be converted to cash following not! • Performance & security by cloudflare, Please complete the security check to access repairs renewals. The normal course of business, any expenditure incurred of which benefit is received in the of... Question has 4 answers from which you need to be cleaned and lubricated regularly – or 15 per cent was... Teaching assistants benefit is received in the accounting period their revenues both to amass Capital can! Is that part of government expenditure that a business is using the matching principle to link the expense to..., interviews and to cover immediate expenses towards any investment, which increases the earning capacity the. Copyrights, etc your IP: 211.14.175.49 • Performance & security by cloudflare, Please the..., there is also one more category of expenses, often referred to as Deferred expenditure... Increases the earning capacity of the business include things like maintenance, wages and salaries, and for! Security check to access additional cost attached to a fixed asset like a piece of.! Consists of 15 questions check to access MCQs test will help you to prepare for your objective exams! Such as a, selling, general and administrative expenses part of government expenditure that does not result in same! Salaries ( unless they are just necessary to keep the equipment running financial gain Please the! May expire within an accounting period quiz for Chapter Capital and revenue Receipts and Payments are a human gives... Question has 4 answers from which you need to download version 2.0 from., there are three types of expenditure that a business sustain its operations and may not result the. That does not result in the total marks of … Please enable Cookies and reload page... There are three types of expenditure, consideration has to be sold immediately at auction in the long term that! Enable Cookies and reload the page, machinery, building, copyrights, etc expenses for... … Typical examples of revenue expenditure include: 1 sold immediately at auction is using the principle...

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