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Question
An expenditure is Revenue expenditure if ______.
Options
It neither affects liabilities nor assets.
It either affects liabilities or assets.
Either It neither affects liabilities nor assets or It either affects liabilities or assets.
None of these.
Solution
An expenditure is Revenue expenditure if it neither affects liabilities nor assets.
Explanation:
An expenditure that neither creates assets nor reduces liability is called Revenue Expenditure, such as employee salaries, interest payments on past debt, subsidies, pensions, etc.
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