[amp_mcq option1=”Revenue expenditure” option2=”Capital expenditure” option3=”Deferred revenue expenditure” option4=”Operating expense” correct=”option2″]<\/p>\n
The correct answer is: B. Capital expenditure<\/strong><\/p>\n Capital expenditure is an expenditure incurred on the purchase of fixed assets, such as land, buildings, and equipment. These assets are used in the production of goods or services and are expected to last for more than one year.<\/p>\n Revenue expenditure is an expenditure incurred on the day-to-day running of a business. These expenses are not expected to last for more than one year and are not considered to be part of the cost of producing goods or services.<\/p>\n Deferred revenue expenditure is an expenditure that is initially recorded as an asset but is then amortized over a period of time. This type of expenditure is usually incurred in connection with the acquisition of a long-term asset, such as a building.<\/p>\n Operating expense is an expense that is incurred in the course of running a business. These expenses are not considered to be part of the cost of producing goods or services and are usually recorded as expenses in the period in which they are incurred.<\/p>\n Insurance expenses paid to bring an equipment from the place of purchase to the place of installation is a type of capital expenditure because it is an expenditure incurred on the purchase of a fixed asset.<\/p>\n","protected":false},"excerpt":{"rendered":" [amp_mcq option1=”Revenue expenditure” option2=”Capital expenditure” option3=”Deferred revenue expenditure” option4=”Operating expense” correct=”option2″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[85],"tags":[],"class_list":["post-53932","post","type-post","status-publish","format-standard","hentry","category-accounting","no-featured-image-padding"],"yoast_head":"\n