Categorise the following government receipts into revenue and capital receipts .Give reasons. 1.Loan from the World Bank. 2.Income tax received by government 3.Cash grants -in-aid from foreign countries and international organisations. 4.interest received on loans. 5.Receipts from sale of shares in public sector undertakings.

Dear Student
1. Capital receipt , It increase the liabilities
2. Revenue receipt, they neither create any liability nor any asset of the government.
3. Revenue receipt , they are one time receipt neither create any asset nor liability.
4.Revenue receipt, they are government earning.
5. Capital receipt, they are like disinvestment which reduce government assets.

Regards

  • 3
1 and 3 are capital receipt ... beacuse they are earned one time in a year ... but 2,4,5 are revenue receipt because they earned again again or many times in a year
  • -2
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