How to writing the best Quality Blog Posts to increase your revenue? maybe help with your Better earning tips.Writing usually involves a perfectionist attitude. The idea is simple: writing the perfect first project makes the revision process a lot easier. The only problem with this setting is that it can slow down or block the creative process. If you’re struggling with a perfectionist approach, this method can help you make the writing process more efficient.
Here is the article to explain, writing the best Quality Blog Posts to increase your revenue, these tips maybe help with your Better earnings.
Many bloggers don’t know how to write great blog posts faster, the best blog sites. Therefore, they waste a lot of time writing articles. If you are one of them and want to write great content for your readers and Google. Then you are here. Are you ready? For now, I will share the process of writing articles with you.
So don’t skip these steps and read this article from start to finish because with each step I’ve presented some secret strategies that will allow you to quickly write a great, well-researched blog post. Free and paid App for every writer, Come on, let’s dive!
Run with a good idea.
Stop looking for the perfect idea. If you have a great idea and look forward to then definitely try with it. See where the journey will take you. If the content you write can help your readers while stimulating your passion, your experience will sink in.
The first step is to come up with ideas for blog posts. I know it always hurts to come up with great blog post ideas. Having said that, I’m going to share a few tips that are sure to help you find great blog post topics in the next few minutes.
It clearly contradicts its value.
Many writers hold back the idea that they have to write the definitive guide to everything. Also, This creates a great deal of research material that needs to be reviewed. Look for valuable tips for creating unique guides. Focus on what you already know. If necessary, narrow down your topic.
Make a sketch or outline.
An outline will help you write when you have a plan. Freewriting can be fun, and some writers do it better, but most writers will be more efficient the first time you outline. Also, This ensures that you have a good introduction, content, and conclusion.
Many inexperienced bloggers just start writing their articles without creating a blog post layout, which is a waste of their time. Before you start writing your articles, you will need to create a blog post layout in which you will add your title and sub-headlines. Also, This is the fastest way to create your content.
Accept the idea.
The first project should be about generating ideas rather than perfect prose. Don’t worry about paragraph or sentence structure. Also, Focus on describing each idea to fit your outline. Formatting problems can be fixed during revision.
Improve it.
Writers avoid revisions because mistakes and flaws in the first project make them feel like a failure. Use the revision process to your advantage. Also, Fix what is already good. Improve the material with new or better ideas. Filter your message.
Edit by voice.
Minor flaws can cause major problems in published content. Also, The author is worried about typos. Readers question the writer’s expertise. That’s a bad combination. Reading your content aloud makes it easy to spot these errors.
Collect and compress screenshots and images.
This step provides you with the main benefit of creating a blog post layout. Once you’ve put down your blog post, it’s easy to know which image or screenshot you will use in your article.
Now you need to collect all the images and screenshots that you will use in your article. After you collect these screenshots, you will need to compress them. Now you will definitely ask me this question:
“Why we take compress screenshots image low quality and what tools do you use to compress your screenshots?”
Law? Don’t worry! We will tell you, you maybe try low kb of images and photos for the fast viewing posts page. Also, Try on the imagesmaller.com and tinyjpg.com website.
Writing the best Quality Blog Posts to Increase your Revenue; Image by Piyapong Saydaung from Pixabay.
Write articles without distraction.
After collecting and compressing your images, save them to a folder on your computer. Now it’s your job to write blog posts without distraction. Here are some tips on how to write your articles without distraction.
TIP 1: When writing articles, don’t include any images or screenshots in your articles. You can put “insert screenshot here” in your article where you need to paste the image. And bold this text and change the color. Also, This will help you find all the places where you need to put images after writing your article.
TIP 2: Don’t reread your article as you write it to check for grammar and spelling errors. Write it all at once.
TIP 3: I highly recommend you to write your articles on Google Docs to write articles without distraction. I also use Google Docs to write my articles.
These tips will help you write articles in a challenging and uninterrupted manner.
Now make all the settings by adding the selected image for your blog to the WordPress dashboard. Then add the title, keywords, meta description (e.g. blog description) to your SEO plugin (e.g. Yoast SEO and RankMath WP plugins, etc.). Also, Your article is now ready. You can post them whenever you want.
Then you can publish. When you work in a creative field, there will always be some level of self-criticism to create something that will be appreciated by others. Also, Focus on the help given and your writing will improve.
What does Public Finance Management mean? Introduction to Public Finance, Expenditure, Revenue, and Debt (In Hindi); Collection of sufficient resources from the economy in an appropriate manner along with allocating and use of these resources efficiently and effectively constitute good financial management. Resource generation, resource allocation, and expenditure management (resource utilization) are the essential components of a public financial management system – By Wikipedia.
The Concept of Public Finance Management explains with its Expenditure, Revenue, and Debt.
The following subdivisions form the subject matter of public finance.
Step by step explains each one; Public expenditure, Public revenue, Public debt, Financial administration, and Federal finance.
Public finance is the management of a country’s revenue, expenditures, and debt load through various government and quasi-government institutions. This guide provides an overview of how public finances manage; what the various components of it are, and how to easily understand what all the numbers mean. A country’s financial position can evaluate in much the same way as a business’ financial statements.
The study of government’s role in the public finance economy is, it is the branch of economics; which evaluates the government expenditure of government revenue and government authorities, and one or the other adjustment to achieve desirable effects and avoid undesirable people.
The federal government helps prevent market failure by supervising the allocation of resources, distribution of income, and stabilization of the economy. Regular funding for these programs mostly secures through taxation.
Borrowing from banks, insurance companies, and other governments and earning dividends from their companies helps fund federal government, state and local governments also receive grants and assistance from the federal government, in addition to ports, airport services And user fees with other features; Penalty derived from breaking the law; Revenue from licenses and fees, such as for driving; And the sale of government securities and bond issues is also the source of public finance.
Public expenditure refers to government expenditure ie government expenditure. This is done by the central, state, and local governments of any country. Of the two main branches of public finance, i.e. public revenue and public expenditure, we will first study public expenditure.
Public expenditure can define in this way,
“The expenditure incurred by public authorities like central, state and local governments to satisfy the collective social wants of the people is known as public expenditure.”
But now, the cost of the government across the world has increased a lot. Therefore, modern economists have started analyzing the effects of public expenditure on production, distribution, and income levels, and employment in the economy.
Classical economists did not analyze the effects of public expenditure in the nineteenth century, due to very limited governmental activities for public expenditure.
During the 19th century, most governments followed laissez-faire economic policies, and their work was limited to protecting aggression and to maintain law and order. The size of the public expenditure was very small.
To maximize the social and economic welfare of the governments, there is a need to do various tasks in the field of political, social, and economic activities. To do these duties and tasks, the government needs a large number of resources. These resources call public revenues. Public revenue includes revenue from administrative activities such as taxes, fines, fees, gifts, and grants.
According to Dalton, however, the word “Public Revenue / Income” has two senses – broad and narrow. In its broadest sense, it contains all the income or receipts that can secure a public authority at any time of time. In its narrow sense, however, it includes only the sources of public authority’s income, which is commonly known as “revenue resources”. To avoid ambiguity, thus, the former calls “public receipts” and later “public revenue”.
As such, receipts from public lending (or public debt) and public property sales mainly exclude from public revenue. For example, the budget of the Government of India is classified as “Revenue” and “Capital”. In the “heads of revenue”, the heads of income under the capital budget calls “receipts”, thus, the word “receipts” includes. Public income sources that exclude from “revenue”.
Revenue receipts and capital receipts are both. Revenue receipts derive from the taxes of various forms. Capital receipts include primary internal market borrowing and external debt. However, a large portion of the state’s revenue comes from internal sources. The main point of difference between the two is that where there is a gain or earning of people in the form of a source; then there is public property in the form of a source.
Introduction to Public Finance, Expenditure, Revenue, and Debt, #Pixabay.
Public Debt:
In simple terms, government / public debt (also known as public interest, government debt, national debt, and sovereign debt) is the outstanding debt by the government. Borrowing by public authorities is of recent origin. This practice of revenue collection was not prevalent before the eighteenth century.
“Public debt” often uses interchangeably with sovereign debt terms. Public debt usually refers only to National debt. But in some countries, loans outstanding by states, provinces, and municipalities also include.
In the Middle Ages, borrowing was a rare event. Whenever there is urgency, there is usually a war; the emperor relies on their deposits or borrows on their own debts. However, such lending was not recognized by society. It was considered a “dead-weight” loan.
This promises to the government with them that the holders of these bonds will be paid interest at regular intervals, at the end of the term, at the lump sum rates at the regular intervals.
Prof. According to Taylor,
“Government debt arises out of borrowing by the Treasury, from banks, business organizations, and individuals. The debt is in the form of promises by the treasury to pay to the holders of these promises a principal sum and in most instances interest on that principle.”
Prof. Adams points out that public debt is the source of advance revenue which is opposite with direct/derived revenue; and, therefore every question of public debt should be judged in the light of this fact.
What does Public Revenue mean? Public revenue money receives by a Public. The article on Public Revenue: Introduction, Meaning, Definition, Sources, and Classification. Each explains as, Introduction to Public Revenue, Meaning of Public Revenue, Definition of Public Revenue, Sources of Public Revenue, and Classification of Public Revenue. It is an important tool for the fiscal policy of the Public and is the opposite factor of Public Spending.
Here are explain the Concept of Public Revenue; their key points – Introduction, Meaning, Definition, Sources, and Classification.
By Wikipedia; Revenues earned by the government are received from sources such as taxes levied on the incomes and wealth accumulation of individuals and corporations and the goods and services produced, exports and imports, non-taxable sources such as government-owned corporation’s incomes, central bank revenue and capital receipts in the form of external loans and debts from international financial institutions. It is used to benefit the country.
Governments use the revenue to better develop the country, to fix roads, build homes, fix schools, etc. The money that the government collects pays for the services that are provided for the people. The public sector in three concepts very important, Public Finance, Public Expenditure, and Public Revenue.
Introduction to Public Revenue:
Governments (Public) need to perform various functions in the field of political, social & economic activities to maximize social and economic welfare. To perform these duties and functions, the government requires a large number of resources. The revenues from different sources received by the government call public revenues. Some regularly collect whereas some irregularly collect.
These resources call Public Revenues. Public revenue consists of taxes, revenue from administrative activities like fines, fees, gifts & grants. Revenues are not repayable. Some of them are obtained from the sale of public utilities whereas some are obligatory payments to the government.
Meaning and Definition of Public Revenue:
The income of the government through all sources calls public income or public revenue.
According to Dalton, however, the term “Public Income” has two senses — wide and narrow. In its wider sense, it includes all the incomes or receipts which a public authority may secure during any period. In its narrow sense, however, it includes only those sources of income of the public authority which are ordinarily known as “revenue resources.” To avoid ambiguity, thus, the former is termed “public receipts” and the latter “public revenue.”
As such, receipts from public borrowings (or public debt) and the sale of public assets are mainly excluded from public revenue. For instance, the budget of the Government of India is classified into “revenue” and “capital.” “Heads of Revenue” include the heads of income under the capital budget are termed as “receipts.” Thus, the term “receipts” includes sources of public income that are excluded from “revenue.”
There are both revenue receipts and capital receipts. Revenue receipts are derived from taxes of different forms. Capital receipts include primary internal market borrowing and also external loans. However, the bulk of state revenue comes from internal sources. The major point of distinction between the two is that while the former has the receipts or earnings of the people as the source, the later has the public property as the source.
Sources of Public Revenue:
The following key points highlight the two main sources of public revenue from India.
Tax Revenue, and.
Non-Tax Revenue.
Now, explain;
A] Tax Revenue:
Taxes are the first and foremost sources of public revenue. It is compulsory payments to the government without expecting direct benefit or return by the taxpayer. Taxes collected by Government are used to provide common benefits to all mostly in the form of public welfare services. They do not guarantee any direct benefit for the person who pays the tax. It is not based on a direct quid pro quo principle.
Features of Tax Revenue:
The main characteristic features of a tax are as follows:
A tax is a compulsory payment to pay by the citizens who are liable to pay it. Hence, the refusal to pay a tax is a punishable offense.
There is no direct, quid pro quo between the tax-payers and the public authority. In other words, the taxpayer cannot claim reciprocal benefits against the taxes paid. However, as Seligman points out, the state has to do something for the community as a whole for what the taxpayers have contributed in the form of taxes. “But this reciprocal obligation on the part of the government is not towards the individual as such, but towards the individual as part of a greater whole.”
A tax is levied to meet public spending incurred by the government in the general interest of the nation. It is a payment for an indirect service to make by the government to the community as a whole.
A tax is payable regularly and periodically as determined by the taxing authority.
Taxes constitute a significant part of public revenue in modern public finance. Taxes have macro-economic effects. Taxation can affect the size and mode of consumption, the pattern of production and distribution of income and wealth. Progressive taxes can help in reducing inequalities of income and wealth by lowering the high-income group’s disposable income.
Disposable income is meant the income left in the hands of the taxpayer for disbursement after-tax payment. Taxes imply a forced saving in a developing economy. Thus, taxes constitute an important source of development finance.
Types of Tax Revenue:
The following types below are;
1] Union Excise Duties:
They are, presently, by far the leading source of revenue for the Central Government and are levied on commodities produced within the country, but excluding those commodities on which State excise is levied (viz., liquors and narcotic drugs). The most important commodities from the revenue point of view are sugar, cotton, mill cloth, tobacco, motor spirit, matches, and cement.
2] Customs:
Customs duties include both import and export duties. These are the second-most important source of revenue for the Central Government.
3] GST Tax:
Goods and Services Tax is an indirect tax levied in India on the supply of goods and services. GST levies at every step in the production process but is meant to refund to all parties in the various stages of production other than the final consumer.
India’s biggest indirect tax reform in the form of Goods and Services Tax (GST) has completed plus 1 year. A comprehensive dual GST was introduced in India from 1 July 2017.
4] Income Tax:
Income tax is at present another important source of revenue for the Central Government. It levies on the incomes of individuals, Hindu undivided families, and unregistered firms.
5] Corporation Tax:
The income-tax on the net profits of joint-stock companies calls corporation tax.
6] Wealth Tax:
It is an annual tax on the net wealth of individuals and Hindu undivided families. It is a progressive tax.
7] Gift Tax:
It is a tax on gifts of property by an individual in his lifetime to future successors.
8] Capital Gains Tax:
It applies to capital gains resulting from the sale, exchange or transfer of capital assets.
9] Hotel Expenditure Tax:
Recently, a new tax has been levied on those who patronize high-class hotels.
10] Tax on Foreign Travel:
Another new tax levied on foreign travel for conserving foreign exchange as well as to raise revenue.
B] Non-Tax Revenue:
The revenue obtained by the government from sources other than the tax calls Non-Tax Revenue. Public income received through the administration, commercial enterprises, gifts, and grants is the source of non-tax revenues of the government.
The following sources of non-tax revenue below are:
1] Interest Receipts:
This largest non-tax source of Central Government’s revenue receipts is the interest it earns mainly on the loans it has advanced to State Governments, to financial and industrial enterprises in the public sector.
2] Surplus Profits of the Reserve Bank of India (RBI):
The surplus profits of the RBI is also a part of the revenues of the Central Government. In recent years, these have been quite substantial because of the large borrowing by the Government from the RBI against Treasury Bills for financing the Five-Year Plans.
3] Currency, Coinage, and Mint:
The Government also derives income from running the Currency Note Printing Presses. Moreover, profits are made from the circulation of coins — this profit is the difference between the face value of the coins and their manufacturing cost.
4] Railways:
The railways in India are owned and run by the Government of India. Accordingly, they pay a fixed dividend to general revenues, i.e., to the Central Government, on the capital invested in the railways. Besides, a part of the net profits made by the railways is also payable to the Central Government.
5] Profits of Public Enterprises:
Public enterprises owned by the Central Government, e.g., the Steel Authority of India (SAIL), Hindustan Machine Tools (HMT), Bharat Heavy Electricals Ltd. (BHEL), State Trading Corporation (STC). The profits of such Public Sector Units (PSUs) are another source of revenue for the Government of India.
6] Other Non-Tax Sources of Revenue:
The main source among them is the Departmental Receipts of the various ministries of the Central Government by way of fees, penalties, etc.
Public Revenue: Introduction, Meaning, Definition, Sources, and Classification, #Pixabay.
Classification of Public Revenue:
A scientific classification enables us to know in what respects these various sources resemble one another and in what ways they differ. Different economists have classified the sources of public revenue differently. Of the various classifications of public revenue available in economic literature, we shall review a few important ones.
1. Taylor’s Classification:
The most logical and scientifically based classification of public revenue is however provided by Taylor. He divides public revenue into four categories:
Grants and gifts.
Taxes.
Administrative revenues, and.
Commercial revenues.
Now, explain;
Grants and gifts:
Grants-in-aid are how one government provides financial assistance to another to enable it to perform certain specified functions, for example, education and health grants made to the states by the central government.
Grants-in-aid are the cost payments made by the grantor government and revenue receipts to the grantee, and no obligation of repayment involves. Gifts are voluntary contributions from individuals or institutions for specific purposes. Grants and gifts are voluntary and there is the absence of quid pro quo to the donor.
Taxes:
These are compulsory payments made to the government without expecting a direct return of benefits. The taxes involve varying degrees of coercive powers.
Administrative Revenues:
Under this group, fees, licenses, fines, and special assessments include. Most of these are voluntary and based upon the direct benefits accruing to the payer. They generally arise as a by-product of the administrative or control function of the government.
Commercial Revenues:
These are the receipts by way of prices paid for government-produced goods and services. Under this group, postal charges, tolls, interest on loans of state financial institutions or nationalized banks, tuition fees of public educational institutions include.
2. Dalton’s Classifications:
Dalton provides a very systematic, comprehensive and instructive classification of public revenue. In this opinion, there are two main sources of public revenue — taxes and prices. Taxes pay compulsorily whereas prices pay voluntarily by individuals, who enter into contracts with the public authority. Thus, prices are contractual payments.
Taxes are sub-divided into:
Taxes in the ordinary sense.
Tributes and indemnities.
Compulsory loans, and.
Pecuniary penalties for offenses.
Prices are sub-divided into:
Receipts from public property passively held such as rents received from the tenants of public lands.
Receipts from public enterprises charging competitive rates.
Fees or payments charged for rendering administration services, such as birth and death registration fees, and.
Voluntary public debt.
These two groups must add to another group to make the classification exhaustive. Under this group, the following items include:
Receipts from public monopolies, charging higher prices.
Special assessments.
The issue of new paper money or deficit financing, and.
Voluntary gifts.
3. Seligman’s Classification:
Seligman classifies public revenue into three groups:
Gratuitous revenue.
Contractual revenue, and.
Compulsory revenue.
Now, explain;
Gratuitous revenue; comprises all revenues such as gifts, donations, and grants received by the public authorities free of cost. They are entire of a voluntary nature. Further, these are very insignificant in the total revenue.
Contractual revenue; includes all those types of revenue which arise from the contractual relations between the public authority and the people. Fees and prices fall into this category. A direct quid pro quo is usually present in these types of revenue.
Compulsory revenue; includes the income derived by the state from administration, justice, and taxation. Taxes, fines, and special assessments regard as compulsory revenue. These revenues express an element of state sovereignty. It is the most significant type of public revenue in modern times.
What is Deferred Revenue Expenditure? Deferred Revenue Expenditure is an expenditure which is revenue in nature and incurred during an accounting period, but its benefits are to be derived in multiple future accounting periods. Such expenditure is then known as “Deferred Revenue Expenditure” and is Written off over a period of a few years and not wholly in the year in which it is incurred. So, the question is: What type of Deferred Revenue Expenditure is added to Accounting?
The Concept of Accounting explains the type of Deferred Revenue Expenditure is added.
It will be easier to understand the meaning of deferred revenue expenditure if you know the word deferred. Which means “Holding something back for a later time”. In some cases, the benefit of revenue expenditure may be available for a period of two or three or even more years. These expenses are unusually large in amount and, essentially, the benefits are not consumed within the same accounting period. Part of the amount which is charged to profit and loss account in the current accounting period is reduced from total expenditure and rest is shown in the balance sheet as an asset.
For example,
A new firm may advertise very heavily in the beginning to capture a position in the market. The benefit of this advertising campaign will last quite a few years. It will be better to write off the expenditure in three or four years and not only in the first year. When loss of a specially heavy and exceptional nature is sustained, it can also be treated as deferred revenue expenditure. If a building is destroyed by fire or earthquake, the loss may be written off in three or four years.
The amount not yet written off appears in the balance sheet. But, it should be noted, loss resulting from transactions entered into. Such as a speculative purchase or sale of a large number of commodities. Cannot be treated as deferred revenue expenditure. Only loss arising from circumstances beyond one’s control can be so treated. Suppose, at the end of 2010-2011, a company owed $ 1, 00,000, expressed in rupees at Rs 48, 00,000. Suppose in 2011-2012 the rupee was devalued to Rs 49.50 per dollar raising the liability in terms of rupees to Rs 49, 50,000. This increase is a loss unless it relates to a specific asset; it can be treated as deferred revenue expenditure and spread over a few years.
Then it is called deferred revenue expenditure. For example:
Preliminary expenses at the time of formation of new limited companies.
Heavy advertisement expenses.
Heavy Research and development expenses.
Commission on the issue of shares and debentures.
Major repair expenses.
Discount on issue of shares or debentures, and.
Expenses relating to shifting the business premises from one place to another place.
Understand Another Example,
Let’s suppose that a company is introducing a new product to the market and decides to spend a large amount on its advertising in the current accounting period. This marketing spend is supposed to draw benefits beyond the current accounting period. It is a better idea not to charge the entire amount in the current year’s P&L Account and amortize it over multiple periods.
The image shows a company spending 150K on advertising. Which is unusually large as compared to the size of their business. The company decides to divide the expense over 3 yearly payments of 50K. Each as the benefits from the spend is expected to be derived for 3 years.
What type of Deferred Revenue Expenditure is added to Accounting? Image credit from #Pixabay.
What leads to an increase in capital in the course of business operations is income; what leads to a reduction in capital is expense or loss. But transactions also cover the acquisition of assets, like the purchase of an office building, raising a loan, payment of liabilities, etc.; all transactions are not expenses or incomes. To know the net profit earned or loss suffered, the expenses, losses, and incomes must be assembled in the Profit and Loss Account; the transactions concerning assets and liabilities will affect items in the Balance Sheet which portrays the financial position. So, what has discussed this article: Understand Capital and Revenue Expenditure in Accounting.
The Concept of Capital and Revenue Expenditure, in the Accounting, explains why they exist in Financial Management.
The following expenditures below are;
Capital Expenditure:
What is Capital Expenditure? Capital expenditures (CAPEX) refer to funds that are used by a company for the purchase, improvement, or maintenance of long-term assets to improve the efficiency or capacity of the company. Capital expenditure can be tangible, such as a copy machine, or it can be intangible, such as a patent. In many tax codes, both tangible and intangible capital expenditures are counted as assets because they have the potential to be sold if necessary.
Revenue Expenditure:
What is Revenue Expenditure? A revenue expenditure (REVEX) is a cost that is charged to expense as soon as the cost is incurred. By doing so, business is using the matching principle to link the expense incurred to revenues generated in the same reporting period. The amount incurred on maintaining the earning capacity of the business, The benefit of which is direct and would be in the same accounting year itself in which such expenditure has been incurred is termed as revenue expenditure.
The Concept of Capital and Revenue Expenditure:
Expenses, losses, and incomes are also known as revenue items since they together will show up the net profit or revenue earned. Other transactions are of capital nature. One must be clear in one’s mind regarding the nature of an item of expenditure. This is an important aspect of the matching principle and without it; financial statements cannot be properly prepared.
Capital expenditure is that expenditure which results in the acquisition of an asset, tangible or intangible, which can be later sold and converted into cash or which results in an increase in the earning capacity of a business or which affords some other advantage to the firm.
In a nutshell, if the benefits of expenditure are expected to accrue for a long time, the expenditure is capital expenditure. Obvious examples of capital expenditure are land, building, machinery, patents, etc. All these things stay with the business and can be used over and over again.
Other examples are money paid for goodwill (the right to use the established name of an outgoing firm) since it will attract the old firm’s customers and, thus, result in higher sales and profits; money spent to reduce working expenses.
For example, conve$ion of hand-driven machinery to power-driven machinery and expenditure enabling a firm to produce a large quantity of goods. Expenditure which does not result in an increase in capacity or in the reduction of day-to-day expenses is not the capital expenditure unless there is a tangible asset to show for it.
It should be noted that all amounts spent up to the point an asset is ready for use should be treated as capital expenditure. Examples are fees paid to a lawyer for drawing up the purchase deed of land, overhaul expenses of second-hand machinery, etc. Interest on loans raised to acquire a fixed asset is particularly noteworthy.
Such interest can be capitalized, i.e., added to the cost of the asset but only for the period before the asset is ready for use interest paid for the subsequent period cannot be capitalized. An item of expenditure whose benefit expires within the year or expenditure which merely seeks to maintain the business or keep assets in good working condition is revenue expenditure
Examples are salaries and wages, fuel used to drive machinery, electricity used to light the factory or offices, etc. Such expenditure does not increase the efficiency of the firm, nor does it result in the acquisition of something permanent.
The following items of expenditure seem to be revenue expenditure, but in actual practice, these are treated as capital expenditure since they lead to the business being established and run efficiently:
Expenses for the formation of a company—preliminary expenses.
Cost of issuing shares and debentures and raising loans, such as legal expenses underwriting commission, etc.
Interest on capital up to the point production is ready to commence, where the nature of the business is such that construction work must go on for a long period before production can start.
Expenses on acquisition and installation of assets, for example, legal fees to acquire property, or expenses incurred to renovate machinery bought secondhand or wages of workmen who install the machinery.
Diminution in the value of assets due to wear and tear or passage of time is the revenue loss. For instance, a piece of machinery is bought at the beginning of the year for $ 1, 00,000; at the end of the year, its value to the business may only be $ 90,000. The diminution—known as depreciation—is a revenue loss. Stocks of materials bought will be an asset unless consumed—to the extent, the materials are used up, they will be revenue expenditure, so also the cost of goods sold.
However, the distinction is not always easy. In actual practice, there is a good deal of difference of opinion as to whether a particular item is capital or revenue expenditure. A cinema converts its ordinary screen into one for cinemascope. Is the expenditure-revenue or capital?
One may say that since the eating capacity of the hall does not change, the expenditure is revenue expenditure. On the other hand, it may be argued that since cinemascope pictures attract large audiences, the hall will be full oftener. Therefore, the expenditure will result in higher earnings and should be classified as capital expenditure. There is truth on both sides.
Unde$tand Capital and Revenue Expenditure in Accounting, Image credit from #Pixabay.
What is Revenue Expenditure? A revenue expenditure (REVEX) is a cost that is charged to expense as soon as the cost is incurred. By doing so, business is using the matching principle to link the expense incurred to revenues generated in the same reporting period. The amount incurred on maintaining the earning capacity of the business, The benefit of which is direct and would be in the same accounting year itself in which such expenditure has been incurred is termed as revenue expenditure. So, what is the discussion? Meaning, Definition, and Types of Revenue Expenditure.
The Concept of Revenue Expenditure of explanation in Meaning, Definition, and Types.
Any expenditure incurred in connection with the operation and administration of daily activities of the business is called revenue expenditure. REVEX is incurred for maintaining earning capacity and working efficiency of the fixed assets. Revenue expenditure is incurred for acquiring merchandise for resale either in its original or improved form. Its benefit expires within a year. The most important point to remember here is that the benefit of revenue expenditure would exhaust in one year.
Revenue expenditures are recurring in nature. REVEX should be matched with the revenue receipts of the business enterprise. The basic aim and object of incurring revenue expenditure are to run and maintain the earning capacity of the business enterprise. Note: REVEX is shown on the debit side of the trading and profit and loss accounts.
“It is an expenditure charged against operation; a term used to contrast with capital expenditure”.
Revenue expenditure is incurred in the current period or in one period of account. The benefit of the revenue expenditure is utilized in that period itself.
All the expenditures which are incurred in the day to day conduct and administration of a business and the effect of which is completely exhausted within the current accounting year are known as “revenue expenditures”.
These expenditures are recurring by nature i.e. which are incurred for meeting day to day requirements of a business and the effect of these expenditures is always short-lived i.e. the benefit thereof is enjoyed by the business within the current accounting year. These expenditures are also known as “expenses or expired costs.” e.g.
Purchase of goods, salaries paid, postages, rent, travel expenses, stationery purchased, wages paid on goods purchased etc. This expenditure is incurred on items or services which are useful to the business but are used up in less than one year and, therefore, only temporarily increase the profit-making capacity of the business.
Revenue expenditure also includes the expenditure incurred for the purchase of raw material and stores required for manufacturing saleable goods and the expenditure incurred to maintain the- fixed assets in proper working conditions i.e. repair of machinery, building, furniture etc.
The Purpose of Revenue expenditure:
Revenue expenditure is incurred for the following Purposes:
All establishment and other expenses incurred in the normal course of business. For instance, Administrative expenses of the business, expenses incurred in manufacturing and selling products.
Expenses incidental to the carrying of a business, the benefit of which is consumed within the accounting period. For instance, Rent, Wages, Salaries, Advertising, Taxes, Insurance etc.
Expenditure on goods purchased for resale. Example, the cost of goods purchased or the cost of raw materials etc.
For maintaining fixed assets in working order. For instance, repairs, renewals, and replacement of existing assets, depreciation etc.
These revenue expenditure items appear in Trading and Profit and Loss Account.
Items of Revenue Expenditure:
Expenditure on Rent, Wages, Carriage, Salaries, Postage, Insurance, Advertising etc.
Interest on loan borrowed for running the business.
Cost of goods bought for resale.
Cost of raw materials consumed in the course of manufacturing.
Expenses incurred for maintenance of various assets by way of repairs, renewals and replacement on building, plant, machinery, tools, fixtures, van, car etc. to keep them in good condition.
Depreciation of fixed assets.
Taxes and legal expenses.
Loss arising from the sale of fixed assets.
Maintenance of lights and fans.
All expenses incurred in the manufacturing and distribution of the products handled.
Wages paid for the sale of goods.
Loss of goods by fire or other reasons.
Discounts and allowances.
The Types of Revenue expenditure:
There are two types of revenue expenditure:
Maintaining a revenue-generating asset: This includes repair and maintenance expenses, because they are incurred to support current operations, and do not extend the life of an asset or improve it.
Generating revenue: This is all day-to-day expenses needed to operate a business, such as sales salaries, rent, office supplies, and utilities.
Other types of costs are not considered to be revenue expenditures, because they relate to the generation of future revenues. For example, the purchase of a fixed asset is categorized as an asset and charged to expense over multiple periods, to match the cost of the asset against multiple future periods of revenue generation.
Revenue expenditure includes the following types of expenditures:
Items of expense incurred for producing finished goods such as the purchase of raw material and other direct expenses etc.
Establishment cost such as rent, light, repairs etc.
Administrative costs such as salaries of the staff, telephone expenses etc.
Selling and distribution expenses such as advertisement expenses, commission etc.
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Blog.Com
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Ghost.Org
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Penzu.Com
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WordPress.Com
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Webs.Com
Which of These Best Blogging Sites is Right for You? These are a sampling of the platforms that are out there waiting to host your blog. As you can see, you have options, but some are better than others. What it comes down to is your own personal skill set and what you want from your blog.
How to make money Blogging?
How to make money blogging so want in this article to lay out some basic steps that I see most bloggers who make a living from blogging go through.
Here is how to make money from a blog:
Set up your blog
Start creating useful content
Get off your blog and start finding readers
Build engagement with the readers that come
Start making money from the readership you have through one or more of a variety of income streams
Sounds easy, doesn’t it! On some levels the process is simple but you need to know up front that there’s a lot to each step and below I’m going to give you some pointers on each including some further reading. Become an Instagram Millionaire but How?
Blogger.Com
Blogger is a blog-publishing service that allows multi-user blogs with time-stamped entries. It was developed by Pyra Labs, which was bought by Google in 2003. The blogs are hosted by Google and generally accessed from a subdomain of blogspot.com. Define by Wikipedia. Publish your passions your way. Whether you’d like to share your knowledge, experiences or the latest news, create a unique and beautiful blog for free. You’ll be Make revenue in your blog site with Google AdSense. AdSense gives you more highest ad revenue all time.
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WordPress is a free and open-source content management system based on PHP and MySQL. Features include a plugin architecture and a template system. It is most associated with blogging but supports other types of web content including more traditional mailing lists and forums, media galleries, and online stores. Define by Wikipedia. Choose From a Wide Selection Of Responsive Themes That Look Great Everywhere. Easily Create Your Website Using Our Stunning Templates & Get Your Ideas Online. Live Chat and Email Help. Free Hosting. Scalable and Secure. 24/7 Support. Hundreds of Designs. Built-in SEO. Mobile Ready. You’ll be Make revenue in your blog site with Premium and free Jetpack. WordPress with Jetpack also gives you more highest ad revenue.
Wix.Com
Wix.com Ltd. is an Israeli cloud-based web development platform that was first developed and popularized by the Israeli company also called Wix. It allows users to create HTML5 websites and mobile sites through the use of online drag and drop tools. Define by Wikipedia. It Starts With A Stunning Website. Create Your Free Website Today! 1000s of free images. Advanced image editor. SEO wizard. Customizable online store. Multiple payment methods. Easy-to-add blog. Easy drag n’ drop. Free multilingual fonts. Customizable templates.
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The phenomena of revenue management gained importance in recent years due to the variable and discriminatory pricing schemes offered by various companies to their customers. They apply the orderly analytics that predicts the behavior of the consumer at the micro-level and augments the prices and availability of products to the customers thus enhancing the overall revenue for the company. This article explains the system of Revenue Management: with their concepts – scope, future, and benefits. The aim of devising revenue management techniques is to deliver the fine product or service to the appropriate customer at the precise price.
Here explains; Revenue Management: Meaning, Definition, Scope, Future, and Benefits.
The revenue management system is based on analyzing the customer’s perception of the value that the product would provide and make straight the availability, placement, and price according to that perception.
This discipline became the need of every business rapidly. There could be many reasons for this. Even a kid who is out for selling orange juice will have to analyze and predict the appropriate weather and time for selling his product. When we talk about giant businesses, the need for assessing customer demand and subsequently managing that demand is enormous and critical. A revenue management system is an answer to the question of such demand.
History of Revenue Management:
The concept of revenue management is not new to the business world. Every business that is selling some fragile product needs to flex the price of that commodity due to some uncertain environmental change or response to some competitor’s action or customer’s demand. Seats in airplanes, clothes (i.e. for summer and winter), rooms in hotels, etc., all require their strategies to be sold in a manner that maximizes the overall wealth of the company. This field properly originated in the U.S. airline industry at the start of the 1970s. Bob Crandall of American Airline (AA) who put restrictions on discounted fairs.
After that yield management came into practice which is the foundation of revenue management. American Airline, with the help of other airlines, further extended the yield management system by offering low fares to the cost-sensitive passengers and high priced fares to the time-sensitive passengers, giving maximum value to both types of travelers. The impact of practicing yield management was come into knowledge by the year 1985. American Airline reported about 48 percent profit growth. This huge success attracted other industries to develop into the field of yield management.
Definition of Revenue-management:
It is the application of disciplined analytics that predicts consumer behavior at the micro-market level and optimizes product availability and price to maximize revenue growth. The primary aim of revenue management is selling the right product to the right customer at the right time for the right price and with the right pack. The essence of this discipline is in understanding customers’ perception of product value and accurately aligning product prices, placement and availability with each customer segment.
Overview: Businesses face important decisions regarding what to sell when to sell, to whom to sell, and for how much. They use data-driven tactics and strategy to answer these questions to increase revenue. The discipline of revenue management combines data mining and operations research with strategy, understanding of customer behavior, and partnering with the sales force. Today, the revenue management practitioner must be analytical and detail-oriented, yet capable of thinking strategically and managing the relationship with sales.
The Scope of the revenue management system:
There is a wide range of options available to increase revenue through a revenue management system, the following scope below are;
Pricing strategy:
The pricing strategy is related to envisaging the customer’s perceptions about the value of the product and then setting prices to catch that value. Pricing strategy which a company adopts dictates its objectives i.e. what it wants to accomplish. Company then chooses pricing tactics that can respond to the customer’s expectations. Customer price sensitivity analysis, price ratios and price optimizations are examples of such tactics. The carefully selected pricing strategy can increase the total revenue and ultimately the profitability of the firm. Therefore, they can redefine pricing strategy and can build enhanced pricing tactics.
Distribution channels:
A company can deliver its products with various channels like online or in shops. Different type of cost and revenue are linked to these channels. The customer of a particular nature selects the specific channel for buying. The product for example customers who opt for purchasing online is more price sensitive. Their tools can help to analyze the channels and deciding the appropriate discount. The offers to distribute and retailing channels then to consumers without losing the customers’ perception of the value of the product.
Marketing:
Revenue management tools can help determine the response rate of customers to a particular level of promotional activities. By efficiently promoting the products, a firm can increase its revenues and subsequently the profitability.
The process of Managing Revenues:
The revenue management process begins with collecting data on inventory, Consumer perceptions, and behaviors, product prices, etc. The system employed collects and then store the information mentioned before and uses it to optimize prices, channel selection and amount of price promotional activities required. After the collection of data, segmentation is done by the system to categorize consumers into various groups. After segmentation, the system forecasts the demand by the implementation of quantitative analysis of data like the time-series model and cross-price elasticity.
When the forecast phase is complete, their system comes into the position of giving different options to the company about it. How many different ways can it sell its product to what type of customers? Optimization provides the answer to two questions. First of all, it guides the company about which factor should optimize for price or sales. Secondly, t tells that what optimization technique is relevant and should be opted. For instance, regression analysis for finding out relationships between variables. Discrete choice models for envisaging customer behavior and linear programming. Techniques for setting optimum prices to maximize the total revenue.
Future and Challenges in Revenue Management:
Implementing revenue management in an organization is not an easy task. There can be a lot of obstacles to cultural, organizational and reliability. Issues in information systems already developed like supply chain, customer relationship, and intelligence. Nowadays, it is moving towards more ASP(Application service provider) platforms.
In the future, they will focus on subscription and rent through ASPs rather than developing application systems inside the organization. Future challenges of RM can its placement inside the organization i.e. whether in marketing or finance department. Or, the organization or maybe it will need a whole new department to carry out its activities.
Purpose and Benefits Revenue Management Implementation:
We are discussing above that yield management evolve into revenue management. As it became the standardized practice for the companies, its definition progress. Revenue management is defined as the field which is the concern with answering. The demand questions related to consumer behavior and system and set of methodologies require to make them. Revenue can compare with supply chain management because it aims at lowering. The cost of producing and delivering the products hence increasing the profit, so as the goal of revenue management. There need to be certain business conditions that are essential to successfully implement a revenue management system.
These conditions include customer heterogeneity, production inflexibility, variable and uncertain demand. Management culture, the infrastructure of data and information an so on. Employing a revenue management system benefits the company by unleashing. The hidden demand which can lead to great revenue opportunity. Helps to understand the customer’s choices between price and product characteristics. Increases revenue, suggests discounts on the product when required to build up. The market share and helps in developing a sales-driven organization whose sole focus is profit maximization. Also, read it: Role of Price Perception in Consumer Buying Process.
Revenue Management: Meaning, Definition, Scope, Future, and Benefits.
