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Deffered revenue exp
wat is the diff btwn capital expenditure and deffered revenue expenditure???
Replies (3)
Capital expenditure are those expenditure by which efficiency is increased of a asset and hence they are capitalized.
Revenue expenditure are of recurring nature as they are incurred for day to day activities.
Those revenue expenses which are not write off in the current year and are carried fwd are knw as Deferred Revenue Expenditure.
Thnx for the ans! Bt Here the benifit is for more than 1yr in bth the cases!!?
Dear Vamsi,
1. Capital expenditure: capital expenditure is an expenditure whose benefit will be lasted for long period of time (i.e; for more than one year) eg. purchase of land, plant & machinery etc.
Deferred revenue expenditure is an expenditure of revenue nature but whose effect will be visible after a period of time eg. heavy advertisement or publicity done by an enterprises in the initial period after incorporation (i.e: the benefit of the expenditure is deferred over a period of time.2. Capital expenditure is capitalized under "Fixed Assets" & Deferred revenue expenditure is shown under "Miscellaneous Expenditure" as fictitious assets.
Best of Luck!
Regards,
QLI Success Oriented Coaching for CA and CS
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