In this video, I have discussed the concept of Capital expenditure, Revenue Expenditure, Deferred Revenue expenditure, Capital receipt and Revenue Receipt.

Important Note----
To certain extent, the concept of Deferred Revenue Expense has ceased to exist after the application of AS 26 which prohibits the recognition of the same but at the same time it clarifies that if the expenditure does not generate any future benefit it should be expensed in the year of spending and if it generates future benefits to the enterprise it has to be seen that if such expenditure is covered by some other AS like retirement settlements of employees are now treated under AS15 'Employee Benefits' else it can be treated as intangible asset.
Lastly my purpose of making this video was for the students who are beginning with accountancy, what if no one tells the students what Deferred Revenue Expense is or was and then someday they come across these words? Like there is a basic concept in financial accounting 'substance over form' most people fail to define what it is and what impact it makes to the books.


Explanation by Aman Barnwal

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