Saved Bookmarks
| 1. |
A new manufacturer incurred huge expenditure in advertisement. Explain the nature of expenditure. |
|
Answer» Deferred Revenue Expenditure: “Expenses incurred today, and the benefit of which accrue gradually in subsequent year is called Deferred Revenue Expenditure. For example Expenses like advertisement, which may be incurred in one lump sum but the benefit of which will be received only within a series of years. The proportionate amount due the current year must be arrived at and debited to the P/L account. The balance must be shown on the assets side of the Balance sheet. |
|