The 'Deferred Revenue Expenditure' is an expenditure that: MCQ with Answer and Explanation

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The 'Deferred Revenue Expenditure' is an expenditure that:

A. Provides benefit over several accounting periods

B. Is capital expenditure

C. Is entirely charged to current year

D. Is never written off

Answer: Option A

Solution (By JKSSB Mock Tests)

Deferred revenue expenditure (e.g., heavy advertisement) is written off over a number of years.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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Question #1

The 'True and Fair View' is an overriding requirement of:

A. Financial statements

B. Tax returns

C. Management accounts

D. GST returns

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Correct Answer: Option A

Explanation:
Financial statements must present a true and fair view of the entity's financial position and performance.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

Question #2

Goods given away as charity should be credited to:

A. Cash Account

B. Purchases Account

C. Sales Account

D. Charity Account

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Correct Answer: Option B

Explanation:
Donating goods reduces the stock of purchased goods. Thus, the Purchases account is credited at cost price.

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Question #3

Working Capital Management specifically deals with:

A. Dividend payouts

B. Issuing new equity shares

C. Current assets and current liabilities

D. Fixed assets and long-term debt

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Correct Answer: Option C

Explanation:
It involves managing the relationship between a firm's short-term assets and its short-term liabilities to ensure adequate liquidity.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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