Capital and revenue expenditures - Play Accounting.

Capital expenditures are for fixed assets, which are expected to be productive assets for a long period of time. Revenue expenditures are for costs that are related to specific revenue transactions or operating periods, such as the cost of goods sold or repairs and maintenance expense.Thus, the differences between these two types of expenditures are as follows.

Capital expenditure. By issuing debentures, money is borrowed from the public for a long period of time and is used in the purchase of fixed assets or on the expansion of the business, therefore, premium paid is a capital expenditure. (xxiv) Capital expenditure.

B) Revenue expenditure C) Capital expenditure D) Capital receipt 10. A debt recorded as bad in the earlier year recovered during the year is a A) Revenue receipt B) Revenue expenditure C) Capital expenditure D) Capital receipt 11. Failure to make distinction between capital and revenue items will result in A) under trading B) overtrading C.

Difference between Revenue Expenditure and Capital Expenditure. Capital expenditures are usually one off and they include the substantial investments of money or capital that a government makes for the purpose of expansion in various sectors and different business in order to generate profits.

It can be categorised as capital expenditure or revenue expenditure. Capital expenditure is when fixed assets are bought into the company, these are called capital items. Revenue expenditure is money being spend on items used on a regular basis such as buying stock to sell or paying staff payslips. Capital Expenditure Capital items bought by.

Revenue expenditure is expenditure which is not for increasing the value. fixed assets, but for running the business on a day-to-day basis, is known as revenue expenditure. The difference between revenue and capital expenditure can be seen clearly with the total cost of using a motor van for a firm. To buy a motor van is capital expenditure.

Revenue Expenditure and Capital Expenditure of India! An expenditure that neither creates assets nor reduces a liability is categorised as revenue expenditure. If it creates an asset or reduces a liability, it is categorised as capital expenditure. This is the basis of classification between revenue expenditure and capital expenditure.

Ineligible capital expenditure 5. Revenue expenditure: Simplified cost options:- 15% flat rate for calculating indirect costs Hourly rate The Horizon 2020 programme Direct staff costs on Broadband projects Ineligible revenue expenditure. ERDF Eligibility Guidance Page 4 of 46.

The following points of difference between capital expenditure and revenue expenditure gives the importance of the distinction: 1. Capital expenditure increases the earning capacity of business whereas revenue expenditure is incurred to maintain t.

Capital and Revenue Expenditures 1 Capital and Revenue Expenditures Clarissa Jude April 24, 2015 University of Phoenix Capital and Revenue Expenditures 2 “A capital expenditure is an amount spent to acquire or improve a long-term asset such as equipment or buildings.

The distinction between capital expenditure and revenue expenditure is important because only capital expenditures are included in the cost of a fixed asset. Capital expenditure includes all costs of acquisition, such as delivery, legal charges, installation, upgrade and replacement costs.

What is Revenue Expenditure? Revenue Expenditure is defined as the amount spent or expense incurred, on a consistent basis, towards performing functional activities of the business such as cartage or freight paid, purchasing stock etc. According to the accounting assumption, revenue is documented when it is earned while expenditure is documented when it is incurred.