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Question
State, whether you would consider the following as Capital Expenditure or Revenue Expenditure.
Overhaul expenses of second hand typewriters purchased.
Solution
Capital Expenditure
Reason:
The money was used to prepare a capital asset for usage.
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RELATED QUESTIONS
Pre-operative expenses are ______.
Expenses incurred for construction of a building are classified as ______.
Expenses incurred to repair a second-hand machine, purchase by the firm, to make it usable are treated under which expenditure?
Match the Column I and Column II:
| Column - I | Column - II | ||
| (a) | Preliminary expenses of ₹ 5,000. | i | Capital Expenditure |
| (b) | Purchase of old machine for ₹ 9,500. | ii | Revenue Expenditure |
| (c) | Wage paid ₹ 1,500 for carriage for goods. | iii | Deferred Revenue Expenditure |
| (d) | Loan received from Banks ₹ 10,00,000. | iv | Capital Receipts |
Why is it necessary to differentiate between capital and revenue items in accounting?
State with reason whether the following is Capital or Revenue Expenditure:
Brokerage paid for purchase of land.
Classify the following into Capital, Revenue and Deferred Revenue Expenditures, reason for your answer.
₹ 15,000 paid for obtaining a mortgage.
State whether the following expense is Capital or Revenue.
Purchase of a computer for the office.
Which of the following are Capital Expenditure, Revenue Expenditure and Deferred Revenue Expenditure?
Cost of painting the name of the company and other advertisement message on a newly purchased delivery van.
Classify the following into capital expenditure and revenue expenditure.
Money spent on overhauling of office van.
