Question

Money spent on the preparation of project is

• A. Investment
• B. Expenditure
• C. Wastage
• D. None of these

Hint:

Project preparation cost = Investment for future benefits.

Answer 1

The Correct Option is A

Step 1: Understanding preparation costs.
Money spent on surveys, feasibility studies, reports, and research while preparing a project is not wasted but contributes to future returns.
Step 2: Why it is called investment.
Such expenditure builds the foundation for project success.
It ensures that the project runs smoothly, avoids risks, and gives profitability.
Step 3: Option analysis.
- (A) Investment: Correct, since the money spent creates value in the long term.
- (B) Expenditure: Wrong, because it does not just “consume” resources, it adds value.
- (C) Wastage: Incorrect, as it is purposeful spending.
- (D) None of these: Wrong, since (A) is right.
Step 4: Conclusion.
Money spent on preparing a project is treated as an investment.