Which of the following is not a revenue expenditure ?
Answer Details
The term "revenue expenditure" refers to money that a company spends in order to maintain or run its daily operations. These expenditures are generally short-term expenses that are incurred on a regular basis and do not result in the creation of any long-term asset. Revenue expenditures are typically charged against revenues of the current accounting period.
Out of the given options, "extension of building" is not a revenue expenditure. This is because the extension of a building is a capital expenditure, which refers to money that is spent on acquiring or improving a long-term asset, such as a building or equipment, and is intended to benefit the company over the long term.
When a company extends its building, it is making a significant investment that will provide a long-term benefit to the business, such as the ability to accommodate more staff or equipment. As such, the cost of building extension is treated as a capital expenditure and is typically amortized over a number of years rather than being charged against revenues of the current accounting period.
Therefore, the correct answer is "extension of building."