Question

Cleaning and greasing office fans. It will not increase the earning capacity as it is incurred for maintaining an existing asset. Therefore, it is ______.

Options

• Revenue Expenditure

• Capital Expenditure

• Deferred revenue expenditure

• Capital Receipts

Answer 1

Cleaning and greasing office fans. It will not increase the earning capacity as it is incurred for maintaining an existing asset. Therefore, it is Revenue Expenditure.

Explanation:

Cleaning and greasing office fans are routine maintenance costs to maintain an existing fixed asset; they don’t increase earning capacity or create a new asset, so they’re expensed in the Profit & Loss as revenue expenditure.