Deferred revenue expenditure and it's accounting entries

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Accepted Answer

Deferred revenue expenditure refers to expenses that are incurred in one accounting period but are recognized over a period of time.

Deferred revenue expenditure is recorded as an asset on the balance sheet and is gradually expensed over the period of benefit.
Accounting entries for deferred revenue expenditure involve debiting the asset account and crediting the expense account over the useful life of the expenditure.
Examples of deferred revenue expenditure include advertising expenses, research and development costs, and pre-operating expenses.
These expenses are not immediately recognized as expenses on the income statement but are spread out over the period of benefit to match with the revenue generated.
Deferred revenue expenditure helps in matching expenses with revenues and provides a more accurate representation of the financial performance of a company.

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