Question

Expenditures incurred in normal course of business and whose benefit expires within the year is known as_____While______is that expenditure which results in acquisition of an assets or which results in an increase in earning capacity of business.

• A. Capital expenditure, Revenue expenditure
• B. Revenue expenditure, Revenue expenditure
• C. Deferred revenue expenditure, Revenue expenditure
• D. Revenue expenditure, Capital expenditure

Answer 1

Answer: (D)

Revenue expenditure, Capital expenditure

A revenue expenditure is an amount that is expensed immediately—thereby being matched with revenues of the current accounting period.

which incurred in normal course of business.

Capital expenditureor capital expense is the money a company spends to buy, maintain, or improve its fixed assets, such as buildings, vehicles, equipment, or land. which result in an increase in earning capacity of business.