(a) Explain clearly the difference between capital expenditure and revenue expenditure. (b) Classify the items listed below either as capital or revenue expenditure. Fittings partition in a new shop; Carriage on returns outwards; Cost of weighing machine in a retail shop; Repairs to office safe; Legal costs of collecting debts; Legal costs of building materials for a new office building; Carriage costs of building materials for a new office building; Purchase of an extra motor vehicle for distributor of soda and beer; Cost of paint for repainting the hospital wards from green to blue; Cost of paying for registration number plates of a new motor vehicle; Cost of replacing registration number plates of a motor vehicle;
(a) Explain clearly the difference between capital expenditure and revenue expenditure. (b) Classify the items listed below either as capital or revenue expenditure. Fittings partition in a new shop; Carriage on returns outwards; Cost of weighing machine in a retail shop; Repairs to office safe; Legal costs of collecting debts; Legal costs of building materials for a new office building; Carriage costs of building materials for a new office building; Purchase of an extra motor vehicle for distributor of soda and beer; Cost of paint for repainting the hospital wards from green to blue; Cost of paying for registration number plates of a new motor vehicle; Cost of replacing registration number plates of a motor vehicle;
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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(a) Explain clearly the difference between capital expenditure and revenue expenditure.
(b) Classify the items listed below either as capital or revenue expenditure.
- Fittings partition in a new shop;
- Carriage on returns outwards;
- Cost of weighing machine in a retail shop;
- Repairs to office safe;
- Legal costs of collecting debts;
- Legal costs of building materials for a new office building;
- Carriage costs of building materials for a new office building;
- Purchase of an extra motor vehicle for distributor of soda and beer;
- Cost of paint for repainting the hospital wards from green to blue;
- Cost of paying for registration number plates of a new motor vehicle;
- Cost of replacing registration number plates of a motor vehicle;
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