Quick Answer: What Is Revenue Expenditure Of Government?

Which of the following is a revenue expenditure of the government?

Subsidies is an example of revenue expenditure because revenue expenditure refers to the estimated expenditure in a fiscal year which does not create assets for the government or cause reduction in liabilities for the government..

What does government revenue mean?

Government revenue or National revenue is money received by a government from taxes and non-tax sources to enable it to undertake government expenditures. Government revenue as well as government spending are components of the government budget and important tools of the government’s fiscal policy.

What are the types of revenue expenditure?

There are various types of revenue expenditures.Printer Repair Costs. Most businesses use printers on a daily basis to print reports, customer files, emails and receipts. … Montly Rental Expenses. … Phone and Internet Costs. … Cost for Packaging Supplies. … Upgrading Inventory Software. … Cash Register Repair.

What is meant by capital expenditure?

Capital expenditure is the money spent by the government on the development of machinery, equipment, building, health facilities, education, etc. It also includes the expenditure incurred on acquiring fixed assets like land and investment by the government that gives profits or dividend in future.

What is capital expenditure in simple words?

Capital expenditures (CapEx) are funds used by a company to acquire, upgrade, and maintain physical assets such as property, plants, buildings, technology, or equipment. CapEx is often used to undertake new projects or investments by a company.

What is the main characteristics of revenue expenditure?

Revenue expenditure is the expense happens due to normal business operation and it provides benefit in the same accounting period. The company needs to spend on these expenses in order to run the operation and generate revenue. These expenses will provide the benefit to the company in the current period only.

What are the features of capital expenditure?

Capital expenditure is the money used to buy, improve, or extend the life of fixed assets in an organization, and with a useful life for one year or more. Such assets include things like property, equipment, and infrastructure.

What is revenue expenditure with example?

An amount that is expensed immediately. For example, routine repair costs on equipment are revenue expenditures because they are charged directly to an income statement account such as Repairs and Maintenance Expense.

What is difference between revenue and expenditure?

Capital expenditures are for fixed assets, which are expected to be productive assets for a long period of time. Revenue expenditures are for costs that are related to specific revenue transactions or operating periods, such as the cost of goods sold or repairs and maintenance expense.

Which of the following is the capital expenditure?

Capital expenditures are a long-term investment, meaning the assets purchased have a useful life of one year or more. Types of capital expenditures can include purchases of property, equipment, land, computers, furniture, and software.

Is salary a capital expenditure?

Key Takeaways. Capital expenditures (CAPEX) are a company’s major, long-term expenses, while operating expenses (OPEX) are a company’s day-to-day expenses. … Examples of OPEX include employee salaries, rent, utilities, property taxes, and cost of goods sold (COGS).

What is revenue expenditure?

What is a revenue expenditure? Revenue expenses are incurred when a company purchases products or services necessary for generating revenue in the short term.

Is Rent a capital expenditure?

Capital expenses are not used for ordinary day-to-day operating expenses of a business, like rent, utilities, and insurance. … On the other hand, if you buy office furniture, it is expected that it will last longer than a year, so you are buying a fixed asset, and that purchase is considered a capital expense.

What are some examples of revenue?

Examples of revenue accounts include: Sales, Service Revenues, Fees Earned, Interest Revenue, Interest Income. Revenue accounts are credited when services are performed/billed and therefore will usually have credit balances.

Is revenue a expenditure?

A revenue expenditure is a cost that will be an expense in the accounting period when the expenditure takes place. Revenue expenditures are often discussed in the context of fixed assets. The revenue expenditures take place after a fixed asset had been put into service and simply keeps the asset in working order.