30 seconds . Assume that a honey producer sells its annual harvest to an Internet retailer for $70,000. Click here to get an answer to your question ️ Which of the following is the capital expenditure? Next Question. Capital Expenses or Expenditures are payments by a business for fixed assets, like buildings and equipment. Answer. Pages 34. Testing for use c. Uninsured theft d. Sale tax e. None… D. Both (a) and (b) Answer. Fire insurance on a building . The range of current production or manufacturing activities is mainly a result of past capital expenditures. (ii) Purchase of Metro coaches from Japan. Sales tax paid in conjunction with the purchase of office equipment. Capital outlay b. Cost of repairs. These expenditures are 'non-recurring' by nature. (ii) A sum of ₹ 10,000 was spent on painting the new factory. Click hereto get an answer to your question ️ Identify the following as revenue expenditure and capital expenditure. Assembly b. Monthly rent of a delivery truck. 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 Stop wondering, read and find out how to get a quick soft loan in Nigeria. Stationery, supplies, merchandise. Which of the following is a capital expenditure? 5 years. In cases such as mining, land is depleted of natural resources. 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. The greater capital expenditure for a firm, the lesscash flow it can use. Answered By . The following are capital expenditures EXCEPT the ... answer choices . It`s important for the company to know how to use the cash flow. Wages paid for white washing of building . 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. A. Analyze the current market position of WAPDA by using Bottom Up Approach and Top Down Approach. (iii) ₹ 5,000 paid for the erection of a new machine. A. Each question has 4 answers from which you need to choose the correct one. 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. (i) Subsidies, (ii) Grants, (iii) Repayment of loan, and (iv) Construction of school building. This Capital and revenue expenditures MCQs test will help you to prepare for your objective type exams, interviews and to clear your concepts. However, amount of wages and salaries paid for the erection … The following are capital expenditures EXCEPT the ... answer choices . 10,000, the amount of Rs. Renovation of office space. Top Answer (i) Store fixtures bought (iii) The purchase of a new van . They are important because of the following reasons: 1. 52. A second hand car is purchased for Rs. Tags: Question 4 . Which of the following are Capital Expenditure? C. Wages paid for installation of machinery. d. Depreciation. Expenditure incurred in the ordinary conduct and administration of business, i.e. Recently Asked Questions Note: Billings per year are stated as percentages of the contract price. Debt service. Which of the following is capital expenditure? Capital Expenditure. Select one: a. repairs to motor vehicles. C. Research and development costs. Installation of an air conditioning system. c. cost of… d. Depreciation. State with reasons whether the following are capital or revenue expenditures: (i) A new machine is purchased for ₹ 60,000, ₹ 800 were spent on its carriage and ₹ 1,500 were paid as wages for its installation. C. Wages paid for installation of machinery. Repair expenses Cost of extension to building Depreciation of machinery Electricity expenses A. Related Questions to study. It comprises of the costs incurred for the purchase of different fixed assets. SURVEY . Options. (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. 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. Which of the following is not a capital expenditure? Uploaded by: darrenkanjithara. A. 60 Qs. Similarly, the current decisions on capital expenditure will have a major influence on the future activities of the company. 2. Following are the examples of revenue expenditure. Installation of an air conditioning system. The addition of a building wing B. C) repairs of motor vehicle. View Answer. If a Keynesian expenditure-output model shows that aggregate demand for both goods and labor has shifted to the left to D1, while wages remained at w0 and prices remained at P0, what will be the result? Which of the following is a capital expenditure? 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 . Purchase of a goods. b. The following are illustrative examples of capital expenditures. Long-term Effects. Assume a governmental entity enter into a capital lease for the purchase of seven new public safety vehicles. D. Small expenditures to acquire long-lived assets, such as $13 to purchase a wastebasket. 2. Purchase of a Goodwill is _____. Purchase of Furniture Repairs to Machinery Extension of Office Installation of Equipment. Question Which of the following is a capital expenditure? 500 is incurred to get the car registered in owner's name and Rs. 3. answer choices . C. Payment for Salary. B. The contract is non-cancellable. Which of these is NOT a list of revenue expenditure? (i) The cost of an asset Rs.23,000 has been taken as an expense Get Answer. An expenditure which results in the acquisition of permanent asset which is intended lo be permanently used in the business for the purpose of earning revenue, is known as capital expenditure. A. Salaries and wages. Recently Asked Questions Q 4. Q. Salaries and wages expenditures c. Debt service expenditures d. Prepayments for insurance premiums. (iv) Grants given by central government to state Government. 53. Identify between capital and revenue expenditure the … (iii) Repayment of Loan taken from World Bank. D) purchase of furniture. Oil to lubricate machines. Wages paid for repair of building. Wages paid to factory workers. Get Answer. Giving reasons categorise the following into revenue expenditure and capital expenditure. A) salaries and wages. Capital expenditures can be contrasted with operational expenditures, or opex, that are immediately expensed. 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. School Universiti Teknologi Mara; Course Title ACCOUNTING ACC406; Uploaded By hyokaz9. Which of the following is a Revenue Expenditure? Which of the following is not capital expenditure? A tune-up of a company vechile. Salaries and wage expenditures c. Debt Service expenditures d. Prepayments for insurance premiums e. Items a and d only. c. Salaries and wages. Which of these is NOT a list of revenue expenditure? 1,200 is paid as dealer's commission. The effect of capital expenditure decisions usually extends into the future. Which of the following expenditures is of capital nature? Tags: Question 4 . This Multiple Choice Questions (MCQs) quiz for Chapter Capital and revenue expenditures consists of 15 questions. Cost of repair . (i) Salary paid to Army officers. Give reasons. WAGES AND SALARIES: The amount spent as wages and salaries generally taken as a revenue expenses. answer choices . 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. Decoration of office space. Decoration of office space. B) stationery. This preview shows page 15 - 28 out of 34 pages. Capital expenses are not used for ordinary day-to-day operating expenses of a business. 21.Which of the following is capital expenditure? Power required to run machine or motor. The correct answer is D. Related: Practice and Prepare For Your Upcoming Exams; Previous Question . Solution for Which of the following expenditure is not capital expenditure for equipment? b. This includes tangible and intangible assets Example acquisition of building, land, deliver van. excess supply. a)wages paid for repair of building b)wages paid for white… Which of the following is a revenue expenditure. Assets acquired by incurring these expenditures are utilized by the business for a long time and thereby they earn revenue. Renovation of office space. Insurance premium on a building . a. 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. 30 seconds . Practice important Questions. Expenditure incurred to acquire fixed assets for the company. Purchase of goods . D. Rent of a factory. Capital expenditure (CapEx) is a payment for goods or services recorded—or capitalized—on the balance sheet instead of expensed on the income statement. b. goods taken by owner for own use. B. 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. 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. D. Rent of a factory. A capital expenditure. Payment for Machinery. 1,000 is spent on its repairs, Rs. B. Solution for Which of the following is a capital expenditure? Still, do not forget that it`s an industry-specific ratio. 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