Which of the following is a capital expenditure? C. Wages paid for installation of machinery. A second hand car is purchased for Rs. Correct answer to the question: Of the following is a capital expenditure: a) wages paid for repair of building b) wages paid for of building c) wages paid for reconstruction of building d) wages paid for cleaning of building - eanswers.in Following are the examples of revenue expenditure. Installation of an air conditioning system. answer choices . Salaries and wage expenditures . 60 Qs. 21.Which of the following is capital expenditure? 10,000, the amount of Rs. Practice important Questions. Get Answer. Stationery, supplies, merchandise. Long-term Effects. The addition of a building wing B. A. Answered By . A. Grewal's Accountancy Test Paper 1. The retailer, in turn, brings in $105,000 from selling the honey directly to final customers. Still, do not forget that it`s an industry-specific ratio. Capital expenditure or capital expense (capex or CAPEX) is the money an organization or corporate entity spends to buy, maintain, or improve its fixed assets, such as buildings, vehicles, equipment, or land. Purchase of goods . (i) and (ii) are revenue expenditure because they create neither assets nor reduce liability but (iii) and (iv) are capital expenditure since (iii) reduces liability and (iv) creates an asset. These expenditures are 'non-recurring' by nature. It is considered a capital expenditure when the asset is newly purchased or when money is used towards extending the useful life of an existing asset, such as repairing the roof. 5 years. a)wages paid for repair of building b)wages paid for white… Sales tax paid in conjunction with the purchase of office equipment. (i) Store fixtures bought (ii) Wages of shop assistants (iii) The purchase of a new van (iv) Petrol for van . Cost of repair . (iii) ₹ 5,000 paid for the erection of a new machine. Capital outlay b. Options. Select one: a. repairs to motor vehicles. C. Wages paid for installation of machinery. Capital Expenditure. Renovation of office space. It was commonly accepted (although technically unresolved) that wages were not capital in nature and were therefore deductible under section 8-1 of the 1997 Act. Pages 34. Give reasons. Which of these is NOT a list of revenue expenditure? Capital expenses are not used for ordinary day-to-day operating expenses of a business. Salaries and wages expenditures c. Debt service expenditures d. Prepayments for insurance premiums. Stop wondering, read and find out how to get a quick soft loan in Nigeria. In cases such as mining, land is depleted of natural resources. The correct answer is D. Related: Practice and Prepare For Your Upcoming Exams; Previous Question . Stationery, supplies, merchandise. Which of the following is not a common type of governmental fund expenditure? b. Capital expenditure (CapEx) is a payment for goods or services recorded—or capitalized—on the balance sheet instead of expensed on the income statement. CAPITAL EXPENDITURES Capital expenditures are incurred when a business spends money either to buy non-current assets, or add to the value of an existing non-current asset. Power required to run machine or motor. Which of these is NOT a list of revenue expenditure? It`s important for the company to know how to use the cash flow. School Universiti Teknologi Mara; Course Title ACCOUNTING ACC406; Uploaded By hyokaz9. Next Question. C) repairs of motor vehicle. (v) Loan given to Union Territories. Assets acquired by incurring these expenditures are utilized by the business for a long time and thereby they earn revenue. Which of the following is capital expenditure? Payment for Machinery. Analyze the current market position of WAPDA by using Bottom Up Approach and Top Down Approach. a) Revenue Expenditure b) Capital Expenditure c) Deferred Revenue Expenditure d) Not an Expenditure Q5] A firm has reported a profit of Rs.1,47,000 for the year ended 31-3-2014 after taking into consideration the following items. Investments by businesses include capital expenditures Capital Expenditures Capital expenditures refer to funds that are used by a company for the purchase, improvement, or maintenance of long-term assets to improve on various assets. Debt service. Which of the following are of capital nature? The range of current production or manufacturing activities is mainly a result of past capital expenditures. The contract is non-cancellable. Related Questions to study. Testing for use c. Uninsured theft d. Sale tax e. None… 1,000 is spent on its repairs, Rs. The cash flow and capital expenditure constantly go through the business cycles of a company life. The legal life of most patents is: A. Click hereto get an answer to your question ️ Identify the following as revenue expenditure and capital expenditure. c. Salaries and wages. (iii) Repayment of Loan taken from World Bank. Fire insurance on a building . Purchase of a Goodwill is _____. A tune-up of a company vechile. Wages paid for repair of building. Q. A capital expenditure. excess supply. Prev Question Next Question. D. Small expenditures to acquire long-lived assets, such as $13 to purchase a wastebasket. Capital expenditure may include the following expenditures:-Expenditure incurred on the acquisition of fixed assets, ... All expenses incurred in the ordinary conduct of business, such as rent, salaries, wages, manufacturing expenses, carriage, commission, legal charges, insurance and advertisement, free samples, salaries, postage expenses etc. 1,200 is paid as dealer's commission. Tags: Question 4 . Recently Asked Questions Q 4. Which of the following is not capital expenditure? B. Solution for Which of the following expenditure is not capital expenditure for equipment? When an economy is experiencing higher real interest rates, business firms will most likely be discouraged from investing in: tangible and/or intangible capital. B. The effect of capital expenditure decisions usually extends into the future. Capital expenditures can be contrasted with operational expenditures, or opex, that are immediately expensed. Which of the following is not a capital expenditure? SURVEY . Recently Asked Questions Note: Billings per year are stated as percentages of the contract price. Land Land is a special type of capital expenditure as its value doesn't typically deprecate because it generally doesn't go down in value. answer choices . A. Wages paid for white washing of building . Cost of repairs. Solution for 23Which one of the following is capital expenditure? Purchase of a goods. 52. (i) The cost of an asset Rs.23,000 has been taken as an expense Each question has 4 answers from which you need to choose the correct one. 30 seconds . Answer. View Answer. WAGES AND SALARIES: The amount spent as wages and salaries generally taken as a revenue expenses. Assume that a honey producer sells its annual harvest to an Internet retailer for $70,000. Monthly rent of a delivery truck. SURVEY . Wages for construction of building. (ii) Purchase of Metro coaches from Japan. Replacement of an old motor with a new one in a piece of equipment C. A tune-up of a company vehicle D. A complete overhaul of an air-conditioning system E. The cost of installing a piece of equipment . 3. Oil to lubricate machines. Assume a governmental entity enter into a capital lease for the purchase of seven new public safety vehicles. B. Tags: Question 4 . (i) Subsidies, (ii) Grants, (iii) Repayment of loan, and (iv) Construction of school building. C. Research and development costs. Consider the following points to decide the nature of capital expenditure − The expenditure, the benefit of which cannot be consumed or utilized in the same accounting period should be treated as capital expenditure. WHEN REVENUE EXPENDITURE BECOMING CAPITAL EXPENDITURE Following are some of the circumstances under which an expenditure which is usually of revenue nature may be taken as an expenditure of a capital nature: 1. Decoration of office space. 30 seconds . Salaries and wages. Expenditure incurred to acquire fixed assets for the company. Which of the following is a capital expenditure? The following are capital expenditures EXCEPT the ... answer choices . Which of the following is a capital expenditure: a) Wages paid for repair of building b) Wages paid for white washing of building c) Wages paid for reconstruction of building d) Wages paid for cleaning of building 2 See answers RehbarKhan RehbarKhan Answer: Here is your answer. 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