Question
Which of the following transactions is revenue
expenditure?Solution
The revenue expenditure is the expenditure incurred in the day-to-day operations of a business that is expensed immediately and is not related to acquiring capital assets or investments. Among the options provided, the transaction that represents revenue expenditure is ‘Annual repair charge on a machine ₹10,000’. The annual repair charge is a regular expense incurred to maintain and repair a machine. It is a revenue expenditure because it is necessary to keep the machine in working condition and does not result in the acquisition of a new asset or an improvement to an existing asset. The other options represent capital expenditures.
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Question figure
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