Question

Deferred revenue expenditure also results in a benefit which will accrue in future period but generally for__________.

• A. 3 or 5 months
• B. 3 or 5 years
• C. 1 year
• D. 10 or 11 months

Answer 1

Answer: (B)

3 or 5 years

Deferred revenue expenditure is an expenditure which is revenue in nature and incurred during an accounting period, but its benefits are to be derived in multiple future accounting periods.

These expenses are usually large in amount and benefits are not consumed within the same accounting period. Part of the amount is shown is shown in profit and loss account and is reduced from total expenditure and rest is shown in balance sheet.