What are the drawbacks of revenue expenditures?

Accounting Dec 08, 2020

Expert Solution

Revenue expenditure refers to the expenses that are essential for an organization to maintain the earning capacity.

Disadvantage of revenue expenditure is that it is the additional cost that a producer, firm or organization has to bear for maintenance that does not give any future benefit in return.

For example, lubrication in machinery is necessary to maintain the working condition is a revenue expenditure which will not provide anything.

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