wiz-icon
MyQuestionIcon
MyQuestionIcon
1
You visited us 1 times! Enjoying our articles? Unlock Full Access!
Question

Today is 31st July'17, Arun has started his business from 1st April'17. He has sold computers for the period from April to July and he has paid rent from April to August. For what period would the revenue and expense be recorded?


A

Revenue - April to July
Expense - April to August

No worries! We‘ve got your back. Try BYJU‘S free classes today!
B

Revenue - April to August
Expense - April to July

No worries! We‘ve got your back. Try BYJU‘S free classes today!
C

Revenue - April to July
Expense - April to July

Right on! Give the BNAT exam to get a 100% scholarship for BYJUS courses
D

Revenue - April to August
Expense - April to August

No worries! We‘ve got your back. Try BYJU‘S free classes today!
Open in App
Solution

The correct option is C

Revenue - April to July
Expense - April to July


Arun has sold computers from April to July. Considering the date today is 31st July'17, although he has paid rent from April to August, we still consider the expense of rent payment from April to July. This is because, in order to compare revenue and expense, he has to ensure they are of the same period. This aspect is covered by the Matching concept.

Hence both revenue and expense would be recorded for the period from April to July.


flag
Suggest Corrections
thumbs-up
0
similar_icon
Similar questions
View More
Join BYJU'S Learning Program
similar_icon
Related Videos
thumbnail
lock
GAAP and Basic Accounting Concepts
ACCOUNTANCY
Watch in App
Join BYJU'S Learning Program
CrossIcon