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Amount spent on unsuccessful patent right is a ? a) Revenue Expenditure( even though the amount is large) b) Deferred Revenue Expenditure( If the amount is large) c) Capital Expenditure d) None of these?
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Amount spent on unsuccessful patent right is a ? a) Revenue Expenditur...
Answer: (a) Revenue Expenditure( even though the amount is large)
Description: Amount spent on unsuccessful patent right is a revenue expenditure as the entire amount spent is a loss with no signs of any recovery in future through any income. Hence, entire amount should be written off all at one go.
Thank You.
Description: Amount spent on unsuccessful patent right is a revenue expenditure as the entire amount spent is a loss with no signs of any recovery in future through any income. Hence, entire amount should be written off all at one go.
Thank You.
Community Answer
Amount spent on unsuccessful patent right is a ? a) Revenue Expenditur...
Revenue Expenditure
Revenue expenditure refers to the expenses incurred in the day-to-day operations of a business to generate revenue. These expenses are typically recurring and are charged against the revenue generated in the same accounting period.
Deferred Revenue Expenditure
Deferred revenue expenditure, on the other hand, refers to expenses that are incurred in one accounting period but are expected to benefit multiple accounting periods. These expenses are typically large in nature and are spread over several years.
Capital Expenditure
Capital expenditure refers to the expenses incurred for acquiring or improving a long-term asset. These expenses are not charged against revenue but are capitalized and depreciated over the useful life of the asset.
In the case of an unsuccessful patent right, the amount spent can be classified as either revenue expenditure or deferred revenue expenditure, depending on the nature and size of the expense. If the amount is small and is unlikely to benefit future periods, it would be considered a revenue expenditure. However, if the amount is significant and is expected to provide future benefits, it could be classified as a deferred revenue expenditure.
It is important to carefully evaluate the nature of the expense and the expected benefits before classifying the amount spent on an unsuccessful patent right. This classification will have implications on how the expense is treated in the financial statements and can impact the company's financial performance and position.
Revenue expenditure refers to the expenses incurred in the day-to-day operations of a business to generate revenue. These expenses are typically recurring and are charged against the revenue generated in the same accounting period.
Deferred Revenue Expenditure
Deferred revenue expenditure, on the other hand, refers to expenses that are incurred in one accounting period but are expected to benefit multiple accounting periods. These expenses are typically large in nature and are spread over several years.
Capital Expenditure
Capital expenditure refers to the expenses incurred for acquiring or improving a long-term asset. These expenses are not charged against revenue but are capitalized and depreciated over the useful life of the asset.
In the case of an unsuccessful patent right, the amount spent can be classified as either revenue expenditure or deferred revenue expenditure, depending on the nature and size of the expense. If the amount is small and is unlikely to benefit future periods, it would be considered a revenue expenditure. However, if the amount is significant and is expected to provide future benefits, it could be classified as a deferred revenue expenditure.
It is important to carefully evaluate the nature of the expense and the expected benefits before classifying the amount spent on an unsuccessful patent right. This classification will have implications on how the expense is treated in the financial statements and can impact the company's financial performance and position.
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Amount spent on unsuccessful patent right is a ? a) Revenue Expenditure( even though the amount is large) b) Deferred Revenue Expenditure( If the amount is large) c) Capital Expenditure d) None of these?
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Amount spent on unsuccessful patent right is a ? a) Revenue Expenditure( even though the amount is large) b) Deferred Revenue Expenditure( If the amount is large) c) Capital Expenditure d) None of these? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Amount spent on unsuccessful patent right is a ? a) Revenue Expenditure( even though the amount is large) b) Deferred Revenue Expenditure( If the amount is large) c) Capital Expenditure d) None of these? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Amount spent on unsuccessful patent right is a ? a) Revenue Expenditure( even though the amount is large) b) Deferred Revenue Expenditure( If the amount is large) c) Capital Expenditure d) None of these?.
Amount spent on unsuccessful patent right is a ? a) Revenue Expenditure( even though the amount is large) b) Deferred Revenue Expenditure( If the amount is large) c) Capital Expenditure d) None of these? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about Amount spent on unsuccessful patent right is a ? a) Revenue Expenditure( even though the amount is large) b) Deferred Revenue Expenditure( If the amount is large) c) Capital Expenditure d) None of these? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for Amount spent on unsuccessful patent right is a ? a) Revenue Expenditure( even though the amount is large) b) Deferred Revenue Expenditure( If the amount is large) c) Capital Expenditure d) None of these?.
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