Question : Which of the following statement are true?
- Construction of school building in a capital receipt.
- Expenditure incurred on administrative and defence service is a capital expenditure
Option 1: Both are true.
Option 2: Both are false.
Option 3: Statement 1 is true, statement 2 is false.
Option 4: Statement 1 is false, statement 2 is true.
Answer (1)
23rd Jan, 2024
Correct Answer: Both are false.
Solution :
Construction of school building in a capital expenditure as it increases asset of the government.
Expenditure incurred on administrative and defence service is a revenue expenditure as it neither creates any asset nor reduces any liability of the government.
Hence, Option B is correct.
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