[amp_mcq option1=”An expenditure for entertainment of executives” option2=”Past expenditure made by a company now adjusted from the current profit” option3=”Expenditure which is revenue in nature is spread over a number of years” option4=”An expenditure which cannot be taken into account due to non-availability of a cash E. It is a recurring expenditure of a business organization” correct=”option3″]<\/p>\n
The correct answer is C.<\/p>\n
Deferred revenue expenditure is an expenditure which is revenue in nature but is spread over a number of years. It is usually incurred in the current period but the benefits are enjoyed in the future. For example, the cost of advertising a new product is usually incurred in the current period but the benefits are enjoyed over a number of years as the product is sold.<\/p>\n
A is incorrect because it is an expenditure for entertainment of executives, which is not revenue in nature.<\/p>\n
B is incorrect because it is past expenditure made by a company now adjusted from the current profit, which is not revenue in nature.<\/p>\n
D is incorrect because it is an expenditure which cannot be taken into account due to non-availability of a cash, which is not revenue in nature.<\/p>\n
E is incorrect because it is a recurring expenditure of a business organization, which is not revenue in nature.<\/p>\n","protected":false},"excerpt":{"rendered":"
[amp_mcq option1=”An expenditure for entertainment of executives” option2=”Past expenditure made by a company now adjusted from the current profit” option3=”Expenditure which is revenue in nature is spread over a number of years” option4=”An expenditure which cannot be taken into account due to non-availability of a cash E. It is a recurring expenditure of a business … <\/p>\n