Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Accounting for Shares

Question:
What treatment is given to the preliminary expenses of the company?
Options:
Written off in the same year in which incurred
Written off in the next year in which incurred
Written off in the previous year in which incurred
None of these
Correct Answer:
Written off in the same year in which incurred
Explanation:
According to AS-26, preliminary expenses are written off in the same year in which they are incurred.