Which of the following is not a deferred revenue expenditure?
A)Expenses in connection with issue of equity shares
B)Preoperative expenses
C)Heavy advertising expenses to introduce a new product
D)Legal expenses incurred in defending a suit for breach of contract to supply goods

Question

Quizplus · Accepted Answer

Deferred revenue expenditure refers to expenses that are initially capitalized on the balance sheet because they are expected to benefit the business over several years, but are not tangible assets. Choices A, B, and C are examples of costs that are typically spread over a few years because they benefit the business over time. However, D (Legal expenses incurred in defending a suit for breach of contract to supply goods) is considered a period cost, affecting the profit and loss account of the period in which they are incurred, rather than being spread over multiple periods.

Which of the Following Is Not a Deferred Revenue Expenditure