Multiple choice

A sum of Rs. 50,000 is spent on advertisement for launching a new product by a company. It is a

  1. revenue expenditure

  2. capital expenditure

  3. deferred revenue expenditure

  4. none of these
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

 It is a deferred revenue expenditure, since the expenditure is a large one and the benefits would go beyond the accounting period, in which this expenditure is incurred.

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