Which of the following is an example of a deferred revenue expenditure? MCQ with Answer and Explanation

Question
Which of the following is an example of a deferred revenue expenditure?
A. Purchase of machinery
B. Payment of salary
C. Heavy advertising campaign for a new product launch
D. Payment of rent
Answer: Option C
Solution (By JKSSB Mock Tests)
A heavy advertising campaign for a new product provides benefits over multiple years, making it a deferred revenue expenditure.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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Practice More Accountancy and Book Keeping Questions

Question #1
Which accounting standard deals with the presentation of financial statements?
A. AS 1
B. AS 9
C. AS 2
D. AS 10
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Correct Answer: Option A

Explanation:
AS 1 'Disclosure of Accounting Policies' deals with the classification and presentation of financial statements and the disclosure of accounting policies.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #2
Verification of liabilities ensures that:
A. Liabilities stated exist and correctly represent the firm's obligations
B. All liabilities are paid off
C. Interest rates are lowest
D. No new loans will be taken
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Correct Answer: Option A

Explanation:
Verification confirms the existence, completeness, and accurate valuation of liabilities recorded in the balance sheet.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #3
The 'Closing Stock' is valued on the basis of:
A. Market price only
B. Cost or market price whichever is higher
C. Cost or net realizable value whichever is lower
D. Net realizable value only
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Correct Answer: Option C

Explanation:
Prudence convention and AS 2 require lower of cost and NRV.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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