Start practising
Practice mode Accounting

What is capital expenditure?

Correct answer C. Results in the acquisition of a permanent asset

Explanation

Capital expenditure buys or improves long-lasting (fixed) assets that benefit several accounting periods, unlike revenue expenditure, which is used up within the year.

Report a problem

Answer checked How we write and check questions

Tip: press A, B, C or D to answer, and N for the next question.

Advertisement

More Accounting questions

See all
Question 01 Accounting

Which of these items should not be charged as revenue expenditure?

Correct answer A. Sales tax paid in connection with the purchase of office equipment

Open question
Advertisement
Question 03 Accounting

The accountant of Leo Ltd. recorded a cheque payment to a creditor for materials as 1,340.56, whereas the bank recorded the correct amount of 3,140.56. No correction has been made and bank reconciliation has not detected the error. What is the effect of this error?

Correct answer D. The favourable bank balance as per Pass Book is less than the Bank balance as per Cash book

Open question

Discussion

Have a question about this answer?

Your email address will not be published. Required fields are marked *

Links and website addresses are not allowed in comments.