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Question
In the following case indicate the amount to be debited as Capital Expenditure and Revenue Expenditure:
A total expenditure of ₹ 50,000 was incurred on factory buildings out of this 20% related to repairs and 80% related to extensions.
Solution
Capital ₹ 40,000 (50,000 × 80%), Revenue ₹ 10,000 (50,000 × 20%).
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