Note – Please take our quiz ‘Quiz 28 – Operating Expense – (Answers)‘ on this page before going through the below answers. Only the top 3% of our audience scored 10/10 in all of them.
- Name – Quiz 28 – Operating Expense – (Answers)
- Topic – Operating Expense
- Answers with Explanation
Q1. Operating expenses are shown in the cash flow statement.
Ans. The given statement is True. Operating expenses are recorded in the cash flow statement under the head ‘operating activities’.
Q2. OER is the term used for _____.
Ans. OER stands for Operating Expense Ratio.
Q3. Marketing expenses which provide benefits in the long term are not operating expenses.
Ans. The given statement is True. Such expenses are deferred revenue expenditures as they provide benefits for the long-term i.e. multiple accounting periods.
Q4. Carriage paid is an example of an operating expense.
Ans. The given statement is True. Carriage paid is a regular business expense and is an Opex.
Q5. Operating expenses are shown on the _____ side of an income statement.
Ans. This type of expenditure is shown in the income statement on the debit side.
Q6. Wages paid on the installation of machinery is an operating expense.
Ans. The given statement is False. Any cost incurred on the installation of machinery is a capital expenditure and not an operating expenditure.
Q7. Which of these is an operating expense?
Ans. Staff salaries paid to run the day-to-day operations are operating expenses.
Q8. Operating expenses are shown in _____.
Ans. Operating expenses are debited in the income statement as they reduce profit.
Q9. Operating expenses are also termed as _____.
Ans. OPEX is the term used for operating expenses.
Q10. Operating expenses are incurred _____.
Ans. Opex/Operating Expenditure/Operating Expenses are ongoing costs that businesses have to incur to run their day-to-day operations.