The Federal Ministry of Works recorded the following financial disbursements during a fiscal year:
| Item | Description | Amount (₦) |
|---|---|---|
| 1 | Construction of a new highway bridge | 45,000,000 |
| 2 | Routine servicing and maintenance of operational vehicles | 3,500,000 |
| 3 | Major engine overhaul extending useful life of heavy machinery | 12,000,000 |
| 4 | Payment of administrative staff salaries and allowances | 28,000,000 |
| 5 | Purchase of office stationery and consumable supplies | 1,500,000 |
| 6 | Structural building expansion (construction of a new office wing) | 18,000,000 |
What is the total Recurrent Expenditure of the ministry for the fiscal year?
- ₦33,000,000Answer
- B₦45,000,000
- C₦51,000,000
- D₦75,000,000
Answer
The total Recurrent Expenditure of the ministry is ₦33,000,000.
The correct calculation sums all items that represent recurring operational costs incurred in running government services within a single financial period. Routine servicing of vehicles (₦3,500,000), staff salaries and allowances (₦28,000,000), and office stationery (₦1,500,000) equal ₦33,000,000.
Step-by-Step Solution
Key Concept
Distinction between Recurrent Expenditure (operational costs) and Capital Expenditure (asset acquisition and life-extending overhauls) in Public Sector Accounting.
Estimated Time:2m 0s