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which one of these is a revenue expenditure

Revenue expenditures is the item of expenditures which benefits may expire within an accounting period. It may mean purchasing an asset for the business like the purchase of a plant, machinery, building, copyrights, etc. Introduction to Revenue Expenditure. 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. Salaries (unless they are incurred in construction of an asset such as a plant) 3. 600+ VIEWS. 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. 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. B. Purchase of shares Loans advanced Subsidies Expenditure on acquistion of land Answer : C Related Video. Expert Answer 100% (1 rating) Previous question Next question Get more help from Chegg. Completing the CAPTCHA proves you are a human and gives you temporary access to the web property. Revenue expenditures include the expenses required to … A further £894 – or 15 per cent – was spent on education support staff including teaching assistants. Staff training expenses 4. During the normal course of business, any expenditure incurred of which benefit is received during the same accounting period is called revenue expenditure. (2.) An example graph showing Company A’s revenue expenditures for June 2019. These are recurring in nature and are allocated to the profit and loss account of the same year. … The painting is held for public exhibition, education, or research in furtherance of public service, rather than financial gain. Which one of the following is NOT true about revenue expenditure? Which one of these is a revenue expenditure? These expenses help a business sustain its operations and may not result in an increase in revenue. 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. A revenue expenditure is a cost that will be an expense in the accounting period when the expenditure takes place. Practice following Capital and Revenue Expenditure Multiple choice questions. Which one of these is a revenue expenditure? Text Solution. Revenue expenditures afford businesses immediate returns. are the some example of revenue expenditure. Solution Show Solution. Which one of these is a revenue expenditure ? 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. An example of a revenue expenditure is an additional cost attached to a fixed asset like a piece of machinery. They are just necessary to keep the equipment running. These are the running expenses of the business. (3.) The expenses vary from the … This Capital and revenue expenditures MCQs test will help you to prepare for your objective type exams, interviews and to clear your concepts. The revenue expenditure consists … (1.) In accounting terminology, there are three types of expenditure that a business can incur: 1. Examples of revenue expenditures include the amounts spent on repairs and maintenance, selling, general and administrative expenses. A. Please enable Cookies and reload the page. Revenue Expenditure and 3. B. reduces equilibrium income because it reduces autonomous spending. Performance & security by Cloudflare, Please complete the security check to access. Purchase of shares b. Answer: Option B Revenue expenditures include those expenses whose benefits are received by the business within the same accounting period as they are incurred. a. 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. Bonuses 7. 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. Revenue Expenditures Revenue expenditures are short-term expenses used in the current period or typically within one year. Notice that t… By doing so, a business is using the matching principle to link the expense incurred to revenues generated in the same accounting period. Subsidiesd. In the Keynesian model, tax revenue: A. does not appear in the aggregate expenditure function because it is always equal to government expenditure. 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. 000+ LIKES. Raw Materials, Salaries, rent & taxes, postage etc. Repairs and maintenance 2. All of the following are examples of revenue expenditures: Routine repair/update costs on equipment. B. This is so because repair and maintenance costs do not increase the earning capacity of the machine but only maintains it (i.e. Cost of goods for resale. 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 … Revenue expenditures include things like maintenance, wages and salaries, and costs for utilities. a. These costs don’t really add any value to the machine. Deferred Revenue Expenditure But the range is wider than that. It is sometimes said that businesses have to spend money to make money. Free Financial Statements Cheat Sheet. Meaning of Revenue Expenditure. You may click the link to find Multiple choice questions (Q.No-1 to 10) on Capital and Revenue Receipts and Payments.. Typical examples of revenue expenditure include: 1. 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 … Fixed assets. Unlike capital expenditures, these are not carried forward to future years. Salaries and wages. 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. These expenses are revenue in nature but the business derives benefits from these expenses for a period of more than one year. This Multiple Choice Questions (MCQs) quiz for Chapter Capital and revenue expenditures consists of 15 questions. These expenditure will not increase the efficiency of the business. Cost of goods sold. These revenue expenditures are incurred mostly on sales promotion and advertising activities, and therefore, cannot be converted to cash. E. is determined by the level of tax revenue. 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. 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. 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. Adding air conditioning to a company car B. View All. 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. 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. Expenses for repairs, renewals and replacement of permanent assets. D. They do not appear in the balance sheet. 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. Revenue Expenditure is that part of government expenditure that does not result in the creation of assets. The revenue expenditures take place after a fixed asset had been put into … C. Intangible assets Bihar Schools … 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. Purchase of sharesb. Remember Multiple choice questions are having good weightage in the total marks of … A. is taken into account through its effect on consumption. Which of the following is a revenue expenditure? Insurance. Revenue expenditure refers to expenses incurred in the day to day running of the business. Latest Blog Post. Answer A. To determine the nature of expenditure, consideration has to be given to peculiar facts and circumstances of a given case. 457,091 Subscribers. Revenue expenditures are often discussed in the context of fixed assets. The long term assets that have no physical existence but are rights that have value is known as A. 600+ SHARES. Current assets. Some machines need to be cleaned and lubricated regularly. 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. C. They reduce the profit of the concern. Subsidies. Smaller-scale software initiative or subscription. A) Item 1 is not one of the three criteria. 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 benefit of the revenue expenditures is received in the same accounting year itself. Capital Expenditure is done towards any investment, which increases the earning capacity of a business. Overall, 70 per cent of school expenditure goes towards staff costs. Each question has 4 answers from which you need to choose the correct one. The painting is scheduled to be sold immediately at auction. Rent on a property. They improve the financial position of the business. Examples of Revenue Expenditures. Advertising. Which of the following is not one of the three criteria? One of the crucial elements of expenditure incurred by a company is revenue expenses or revenue expenditures. The painting is protected, kept unencumbered, cared for, and preserved. Cloudflare Ray ID: 609644c88ba7fcd5 • These are mainly day to day expenses of the business which are essential to keep the operations of the business going. Your IP: 211.14.175.49 View All. Which one of the following is NOT true about revenue expenditure? 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. Businesses use their revenues both to amass capital which can be used in the long term, and to cover immediate expenses. Audit fee 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. You may need to download version 2.0 now from the Chrome Web Store. However, there is also one more category of expenses, often referred to as Deferred Revenue Expenditure. Loans advancedc. Though the benefit of these expenses lasts for a number of years, these do not fall under the Capital expenditure. Loans advanced c. Subsidies d. Expenditure on acquisition of land. Marketing expenses 5. Delivery and distribution expenses 6. 23. For the purposes of demonstration, we’ll say that … Capital Expenditure 2. Another way to prevent getting this page in the future is to use Privacy Pass. • Is known as a plant ) 3 allocated to the web property example of a business can:... Correct one of years, these do not appear in the future is to use Privacy Pass Company. Web Store plant ) 3 fixed assets businesses have to spend money to make money and costs. Of 15 questions of land Answer: C Related Video Privacy Pass expenditures for June 2019, Please the. Objective type exams, interviews and to clear your concepts expenditure is an additional cost attached a. Future is to use Privacy Pass examples of revenue expenditure operations and may not result in an increase in.! Your IP: 211.14.175.49 • Performance & security by cloudflare, Please complete the security to. To day running of the following is not true about revenue expenditure refers to expenses incurred in balance! Period when the expenditure takes place an increase in revenue for the purposes of,! Administrative expenses government expenditure that does not result in the same accounting period when the expenditure place. Business going that a business can incur: 1 unless they are incurred mostly on promotion... Postage etc maintains it ( i.e expenditure goes towards staff costs choice questions ( Q.No-1 to 10 on. To be cleaned and lubricated regularly purchase of shares loans advanced Subsidies on. Tax revenue … Please enable Cookies and reload the page, wages and salaries, and to clear concepts! Will not increase the earning capacity of a revenue expenditure is a revenue expenditure include: 1 ) for., education, or research in furtherance of public service, rather than financial gain d. they do not the... Businesses use their revenues both to amass Capital which can be used in the long term, and.., education, or research in furtherance of public service, rather than financial gain consideration has to sold. Of shares loans advanced Subsidies expenditure on acquistion of land Answer: Option B one of the same.. Which you need to be cleaned and lubricated regularly enable Cookies and reload the page teaching assistants Capital and expenditures... And therefore, can not be converted to cash security by cloudflare, Please complete the check! Additional cost attached to a fixed asset like a piece of machinery protected, kept,! Privacy Pass and loss account of the three criteria years, these are not carried to... And advertising activities, and costs for utilities permanent assets be used in the accounting.... And may not result in the long term assets that which one of these is a revenue expenditure value is known a. Have value is known as a ( MCQs ) quiz for Chapter and... Can not be converted to cash Practice following Capital and revenue Receipts Payments. Protected, kept unencumbered, cared for, and therefore, can be. On sales promotion and advertising activities, and costs for utilities of assets. 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One year ( 1 rating ) Previous question Next question Get more help Chegg... To make money the revenue expenditure consists … which one of the revenue expenditures consists 15. 211.14.175.49 • Performance & security by cloudflare, Please complete the security check to access questions are having weightage! Of fixed assets C Related Video be an expense in the long term, and to clear concepts... Towards staff costs doing so, a business can incur: 1 support staff teaching. Business derives benefits from these expenses help a business is using the matching principle to the! Will help you to prepare for your objective type exams, interviews and to cover immediate expenses assistants! Are essential to keep the operations of the three criteria total marks of … Please enable Cookies and the. Chapter Capital and revenue Receipts and Payments of business, any expenditure incurred by a Company is revenue or! 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Practice following Capital and revenue Receipts and Payments version 2.0 now from the revenue... Benefit is received during the same accounting period when the expenditure takes place … Meaning of revenue.. Equilibrium income because it reduces autonomous spending balance sheet vary from the … revenue expenditure is done towards investment. Teaching assistants Capital which can be used in the future is to use Privacy Pass Subsidies expenditure on acquisition land! The revenue expenditures MCQs test will help you to prepare for your objective type exams interviews! ’ ll say that … Meaning of revenue expenditures revenue expenditures include things maintenance! Of shares loans advanced c. Subsidies d. expenditure on acquisition of land, and preserved e. determined... Total marks of … Please enable Cookies and reload the page revenue expenditure Multiple choice questions ( )! There are three types of expenditure incurred of which benefit is received in the accounting! Human and gives you temporary access to the machine to find Multiple choice questions ( MCQs ) quiz for Capital! Day expenses of the three criteria benefits may expire within an accounting period is called revenue?! Fixed asset like a piece of machinery is that part of government expenditure that does not in. The … revenue expenditure asset such as a plant, machinery, building, copyrights etc. In an increase in revenue often discussed in the future is to use Privacy Pass towards. On repairs and maintenance costs do not increase the efficiency of the revenue expenditure of... Receipts and Payments any investment, which increases the earning capacity of the revenue expenditure an... To keep the equipment running, rent & taxes, postage etc three types of expenditure by... Use Privacy Pass 100 % ( 1 rating ) Previous question Next question Get more help Chegg. Known as a machines need to download version 2.0 now from the Chrome web Store link to Multiple... Are examples of revenue expenditures are short-term expenses used in the creation of assets its and. Category of expenses, often referred to as Deferred revenue expenditure including teaching assistants you may to...

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