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- Subject
- Capital And Revenue Expenditureauditing-mcqs › capital-and-revenue-expenditure
- Published
- 27 Jul 2019
- Last updated
- 28 May 2026
Which of the following costs should be classified as a revenue expense rather than a capital expenditure?
Multiple choice question for Capital And Revenue Expenditure. Select an option, then review the explanation below.
Explanation
Options A, B, and D represent capital expenditures as they relate to acquiring or preparing fixed assets. However, option C involves legal costs to defend a patent title, which are considered revenue expenses since they do not enhance or extend the asset's life but are incurred to maintain its current value.
More Capital And Revenue Expenditure MCQs
Practice related questions from the same subject.
- 1.If the directors do not appoint the first auditor(s), at which meeting must the shareholders appoint them by passing a resolution?
- 2.When must the board of directors appoint the first auditor of a company?
- 3.At what percentage of the original cost does an asset's book value allow a company to stop recording depreciation?
- 4.Identify which of the following qualifies as a revenue reserve.
- 5.Which of the following actions does not result in the formation of a secret reserve?