The correct answer is: B. Time period
Operating expenses are divided on the basis of time period because they are incurred over a period of time. This allows businesses to track their expenses and see how they are changing over time. It also allows them to compare their expenses to other businesses in the same industry.
Revenue and capital expenditure are not relevant to the division of operating expenses. Sales ratio and capital ratio are not terms that are used in accounting.
Here is a more detailed explanation of each option:
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A. Revenue and capital expenditure
Revenue is the income that a business generates from its sales. Capital expenditure is the money that a business spends on long-term assets, such as buildings and equipment. These two items are not relevant to the division of operating expenses. -
B. Time period
Operating expenses are incurred over a period of time. This allows businesses to track their expenses and see how they are changing over time. It also allows them to compare their expenses to other businesses in the same industry. -
C. Sales ratio
Sales ratio is not a term that is used in accounting. -
D. Capital ratio
Capital ratio is not a term that is used in accounting.