Ask Question
6 January, 10:29

Which of the following below is an example of a capital expenditure? a. cleaning the carpet in the front room b. replacing all burned-out light bulbs in the factory c. replacing an engine in a company car d. tune-up for a company truck

+5
Answers (1)
  1. 6 January, 10:52
    0
    c. replacing an engine in a company car

    Explanation:

    Capital Expenditure are long term expenditures incurred on non current assets, whose effect continues beyond an accounting year. Ex : Plant, Building Repair

    Revenue Expenditure are short term expenses, incurred for day to day functioning on current assets, whose effect is only in short term. Ex : Petty repairs.

    Carpet Cleaning, Bulbs replacement, Tune up are all Revenue Expenditures. Replacing engine of a company's car is a non current asset (car) repair which significantly effects the business life of asset in long run. So, It is a Capital Expenditure
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Which of the following below is an example of a capital expenditure? a. cleaning the carpet in the front room b. replacing all burned-out ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers