Revenue expenditure is an expenditure which is periodically incurred to maintain the revenue the revenue-earning capacity of the business, e.g.,
- Expenditure incurred to maintain the value of any existing asset, e.g., ordinary repairs. Whitewashing of the building, etc.
- Expenditure incurred in the ordinary conduct and administration of the business, i.e., tent, salaries, wages, etc.
- Expenditure incurred in connection with the administration and distribution of the goods manufactured or sold, e.g., commission, travelling expense, advertising and so on.
More from this Section
- FOB shipping point & FOB destination
FOB shipping point means that the seller places the goods free on board the carrier, and the buyer pays the freight costs. FOB destination means that the seller places the goods...
- Honor of notes receivable
A note is honored when its maker pays it in full at its maturity date. For an interest bearing note, the amount due at maturity is the face value of the note plus interest...
- Raw materials inventory
Raw materials inventory is a general ledger account. It is also referred to as a control account because it summarizes the detailed data regarding specific inventory...
- Capital expenditures
Capital expenditures refer to the expenditures that increase the operating efficiency, productive capacity, or useful life of a plant asset.
- Activity-based costing (ABC)
Activity-based costing (ABC) is a method of allocating overhead based on each product’s use of activities in making the product.
- Income Statement
Income statement is a financial statement that reflects the results of the operations of a firm over a specified period of time; prepared on a monthly, quarterly, or annual basis.
- Operating leases
The renting of an apartment and the rental of a car at an airport are examples of operating leases. In an operating lease the intent is temporary use of the property...