Select the Most Appropriate Answer from the Alternatives Given Below and Rewrite the Sentence. - Book Keeping and Accountancy

MCQ

Select the most appropriate answer from the alternatives given below and rewrite the sentence.
Purchase of stationery is an _______________ expenditure.

Options

capital
revenue
long-term
deferred revenue

Advertisement Remove all ads

Solution

Purchase of stationery is a revenue expenditure.

Explanation: Stationery is treated as consumable good, as it is used up during the year. The amount of stationery consumed during the year should be debited to Income and Expenditure Account. It is a type of revenue expenditure.

The amount consumed is calculated as,
Opening stock
Add: Purchases made during the year
Less: Closing stock

Concept: Additional Information - Stock of Stationery

Is there an error in this question or solution?

Chapter 7: Accounts of 'Not For Profit' Concerns - Exercise [Page 228]

Q 6 Q 5 Q 7

Advertisement Remove all ads