Expenditure incurred annually on renewal of patent is a ........

Accountancy (Phase -I & II) Introduction to Accounting

Download Solution PDF

Expenditure incurred annually on renewal of patent is a

Revenue expenditure

Capital expenditure

Financial expenditure

Operating expenditure

छोटे Courses बड़े Results

Master Introduction to Accounting

Prepare through Micro-courses

Try Now

Explanation:

Expenditure incurred annually on renewal of patent is a Revenue expenditure. A revenue expenditure is a cost that will be an expense in the accounting period when the expenditure takes place. A revenue expenditure is a cost that is charged to expense as soon as the cost is incurred. By doing so, a business is using the matching principle to link the expense incurred to revenues generated in the same reporting period.