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Answer Posted / monit
deferred revenue expenditure is an expenditure, which is
incurred at the time of initial stage and the benefit of the
expenditure comes in future years.
best example deferred revenue expenditure is huge amt. of
advertisements expenditures.
Deferred Revenue Expenditure consist all those exp. which
are heavy in nature and we can't charge these exp. in single
financial year.
For Eg:Formation Exp. like we are going to open a new
firm and for the promotion of firm we are planning to
advertise the firm through hoardings and through very good
inaugration party, it will consisit a huge amount of Money
if we charge the full amt. in one single time than firm will
show
Loss.so we charge this Exp. in no.
of Years (in next five years or three years etc...) These
are Differed Revenue Expenditures.
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