INTERVIEW QUESTIONS ACCOUNTING PROCESS CAPITAL AND REVENUE EXPENDITURE AND RECEIPTS DETAILS

Question: Assertion: Damages paid on account of breach of contract to supply chain certain goods is a capital expenditure. Reasoning: Such damages are incurred in the ordinary course of business: a) Both the statements are correct and second is correct is a correct explanation of the first b) Both the statements are correct but second is not a correct explanation of the first c) First statement is correct but second is not d) First statement is not correct but second is correct

Answer: (d) First statement is not correct but second is correct
Description: The first statement is incorrect. Damages paid on account of breach of contract to supply certain goods is a revenue expenditure and not a capital expenditure as it is incidental to and arising out of the course of the business. The second statement that such damages are incurred in the ordinary course of business is a correct statement.

(d) First statement is not correct but second is correct
Description: The first statement is incorrect. Damages paid on account of breach of contract to supply certain goods is a revenue expenditure and not a capital expenditure as it is incidental to and arising out of the course of the business. The second statement that such damages are incurred in the ordinary course of business is a correct statement. Source: CoolInterview.com

If you have the better answer, then send it to us. We will display your answer after the approval.

Rules to Post Answers in CoolInterview.com:-

• There should not be any Spelling Mistakes.
• There should not be any Gramatical Errors.
• Answers must not contain any bad words.
• Answers should not be the repeat of same answer, already approved.
• Answer should be complete in itself.

Name :*
Email Id :*
Answer :*
Verification Code	Not readable? Load New Code
Enter the above shown code: *
	Inform me about updated answers to this question