What is Contingent Asset and Contingent liability? What is Capital And Revenue Expenditures and Receipts?
Dear student
contingent asses and contingent liability
A contingent asset can be defined as an asset that may arise due to any gain that is contingent on future events that are not under the control of the organization however contingent liability is the liability that might be occurred depending upon happening and non-happening of some future event.
capital expenditure and Revenue expenditure
(i) Capital Expenditure is incurred for acquisition of fixed assets for use in business while Revenue Expenditure is incurred to conduct the business.
(ii) Capital Expenditure increases the earning capacity of the business while Revenue Expenditure is incurred for earning profits.
capital receipt and revenue receipt
(i) capital receipt either reduces the asset or increases the liability for the company however revenue receipt neither create any liability nor reduces asset
(ii) capital receipts are non-recurring in nature and revenue receipts are recurring in nature
Regards
contingent asses and contingent liability
A contingent asset can be defined as an asset that may arise due to any gain that is contingent on future events that are not under the control of the organization however contingent liability is the liability that might be occurred depending upon happening and non-happening of some future event.
capital expenditure and Revenue expenditure
(i) Capital Expenditure is incurred for acquisition of fixed assets for use in business while Revenue Expenditure is incurred to conduct the business.
(ii) Capital Expenditure increases the earning capacity of the business while Revenue Expenditure is incurred for earning profits.
capital receipt and revenue receipt
(i) capital receipt either reduces the asset or increases the liability for the company however revenue receipt neither create any liability nor reduces asset
(ii) capital receipts are non-recurring in nature and revenue receipts are recurring in nature
Regards