Capital Expenditure? A business purchases a new building for $250,000, and also spends$20,000 on renovations. What is the total capital expenditure?

Step 1: To calculate the total capital expenditure, you need to add the purchase price of the…

Answered: A business purchases a new building for…

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter9: Acquisitions Of Property

Section: Chapter Questions

Problem 45P

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A business purchases a new building for $250,000, and also spends $20,000 on renovations. What is the total capital expenditure?
Accounting
Step by step answer
What is the amount of capital spending?
Some of the following items should be treated as capital and some as revenue. Carriage paid to bring the purchased machinery to the works. Complete redecoration of the premises at a cost of Kshs.150,000. A quarterly account for heating. The purchase of a soft drinks vending machine for the canteen with a stock of soft drinks. Wages paid by a building contractor to his own workmen for the erection of an office in the builder's stockyard. Required: For each item, give an appropriate classification. Give justification for each classification.
What is the amount of capital spending on these general accounting question?
A property is purchased for $600,000 and sold for $900,000. Which of the following statements is most accurate? A.If the property is owned by an individual for 10 months the assessable capital gain is $150,000 B.If the property is owned by a superannuation fund for 15 months the assessable capital gain is $200,000 C.If the property is owned by a company for 10 months the assessable capital gain is $300,000 D.If the property is owned by an individual for 10 months the assessable capital gain is $300,000
Look at the following outlays and identify whether each is normally considered a capital expenditure or an operating expenditure. An outlay of $4,000,000 for a major research and development program An outlay of $3,200 for computer paper and toner. An outlay of $4,000 for a marketing report on possible sales next month. An outlay of $1,750,000 to purchase copyrights from an author
A company spends $20 million dollar for an office building. Over what period should the cost be written off? Choose the answer: A) When the $20 million ia expended in cash B) All in the first year C) Over the useful life of the building D) After $20 million in revenue is recognized
1. Classify the following as either a revenue expenditure (RE) or a capital expenditure (CE). a. Paid $40,000 cash to replace a motor on equipment that extends its useful life by four years. b. Paid $200 cash per truck for the cost of their annual tune-ups. c. Paid $175 for the monthly cost of replacement filters on an air-conditioning system. d. Completed an addition to a building for $225,000 cash. 2. Prepare the journal entries to record the four transactions from part 1.
Johnson's Nursery has net income of $45,500, deprectaition expenses of $2,800, interest of $700, taxes of $2,600, additions to net working capital of $2,500, and capital expenditures of $11,300. What is the amount of free cash flow?
Distinguish between capital and revenue expenditure The following costs were also incurred by Napa Ltd during the financial year ended 30June 20X7: Interest on loan to purchase microcomputer. Cost of software for use with the microcomputer. Cost of customizing the software for use in Napa Ltd.'s business. Cost of paper used by the computer printer. Wages of computer operators. Cost of ribbons used by the computer printer. Cost of adding extra memory to the microcomputer. Cost of floppy disks used during the year. Costs of adding a manufacturer’s upgrade to the microcomputer equipment. Cost of adding air conditioning to the computer room. Required: Classify each of the above as capital expenditure or revenue expenditure.

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A business purchases a new building for $250,000, and also spends $20,000 on renovations. What is the total capital expenditure?