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Honorarium paid to a person who is not a regular employee is:
AA capital expenditure of the year
BA capital receipt of the concern
CA revenue receipt of the concern
DA revenue expenditure of the year
Answer & Solution
Correct answer: D. A revenue expenditure of the year
1. An honorarium is the remuneration paid to a person who is not a regular employee of the organisation.
2. It is a payment for services rendered during the year, recurring in the ordinary course of activity.
3. The textbook states that it is a revenue expenditure.
4. It therefore appears on the debit side of the income and expenditure account.
5. Being a payment rather than a receipt, the two receipt options are ruled out at once.
_Source: TN HSC Class 12 Accountancy (Samacheer Kalvi, Govt of Tamil Nadu), Unit 2 "Accounts of Not-for-Profit Organisation", §2.4_
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