Give reasons. Pages 34. Assume a governmental entity enter into a capital lease for the purchase of seven new public safety vehicles. These expenditures are 'non-recurring' by nature. Purchase of a goods. Click here to get an answer to your question ️ Which of the following is the capital expenditure? A. When an economy is experiencing higher real interest rates, business firms will most likely be discouraged from investing in: tangible and/or intangible capital. 2. The cash flow and capital expenditure constantly go through the business cycles of a company life. Payment for Machinery. The following are illustrative examples of capital expenditures. C) repairs of motor vehicle. Giving reasons categorise the following into revenue expenditure and capital expenditure. Recently Asked Questions Q 4. C. Research and development costs. Practice important Questions. Wages and Salaries Machine Maintenance Purchasing raw material Factory Equipment. Top Answer (i) Store fixtures bought (iii) The purchase of a new van . Which of the following is capital expenditure? Which of the following is a capital expenditure? Grewal's Accountancy Test Paper 1. In cases such as mining, land is depleted of natural resources. d. Depreciation. B) stationery. Answer. B. Sales tax paid in conjunction with the purchase of office equipment. 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. A capital expenditure. 1,200 is paid as dealer's commission. Testing for use c. Uninsured theft d. Sale tax e. None… The legal life of most patents is: A. C. Wages paid for installation of machinery. Which of the following is a Revenue Expenditure? This preview shows page 15 - 28 out of 34 pages. The following are capital expenditures EXCEPT the ... answer choices . (v) Loan given to Union Territories. 2. Consumer expenditures make up 71% of total expenditures while wages account for 59% of total income. SURVEY . Which of the following is a capital expenditure? 30 seconds . Salaries and wage expenditures . Which of the following expenditures is of capital nature? B. Installation of an air conditioning system. A. 1,000 is spent on its repairs, Rs. A. D. Rent of a factory. 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. Monthly rent of a delivery truck. Salaries and wage expenditures c. Debt Service expenditures d. Prepayments for insurance premiums e. Items a and d only. Renovation of office space. Assembly b. 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? B. Which of the following are Capital Expenditure? Expenditure incurred in the ordinary conduct and administration of business, i.e. Stationery, supplies, merchandise. Decoration of office space. 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. 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. The contract is non-cancellable. Get Answer. Which of the following is not a common type of governmental fund expenditure? However, amount of wages and salaries paid for the erection … Purchase of Furniture Repairs to Machinery Extension of Office Installation of Equipment. 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. Power required to run machine or motor. Uploaded by: Madhuramohan. b. answer choices . It comprises of the costs incurred for the purchase of different fixed assets. Fire insurance on a building . Salaries and wages expenditures c. Debt service expenditures d. Prepayments for insurance premiums. Each question has 4 answers from which you need to choose the correct one. 10,000, the amount of Rs. Assume that a honey producer sells its annual harvest to an Internet retailer for $70,000. 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 . 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 Wages paid for repair of building. Prev Question Next Question. Repair expenses Cost of extension to building Depreciation of machinery Electricity expenses A. SURVEY . They can be categorized into the following: Gross fixed capital. (i) Subsidies, (ii) Grants, (iii) Repayment of loan, and (iv) Construction of school building. B. B. Stop wondering, read and find out how to get a quick soft loan in Nigeria. 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. Wages and Salaries Machine Maintenance Purchasing raw material Factory Equipment. Uploaded by: darrenkanjithara. 21.Which of the following is capital expenditure? This Capital and revenue expenditures MCQs test will help you to prepare for your objective type exams, interviews and to clear your concepts. Stationery, supplies, merchandise. 52. View Answer. A. Cost of repair . a. A tune-up of a company vechile. Purchase of goods . The greater capital expenditure for a firm, the lesscash flow it can use. Solution for Which of the following expenditure is not capital expenditure for equipment? (ii) A sum of ₹ 10,000 was spent on painting the new factory. Solution for 23Which one of the following is capital expenditure? Long-term Effects. C. Payment for Salary. b. Expenditure incurred to acquire fixed assets for the company. Which of these is NOT a list of revenue expenditure? Still, do not forget that it`s an industry-specific ratio. Capital Expenditure. Installation of an air conditioning system. Capital expenses are not used for ordinary day-to-day operating expenses of a business. School Universiti Teknologi Mara; Course Title ACCOUNTING ACC406; Uploaded By hyokaz9. Purchase of a Goodwill is _____. 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. c. cost of… The following are capital expenditures EXCEPT the ... answer choices . Tags: Question 4 . Which of these is NOT a list of revenue expenditure? Capital Expenses or Expenditures are payments by a business for fixed assets, like buildings and equipment. WAGES AND SALARIES: The amount spent as wages and salaries generally taken as a revenue expenses. a)wages paid for repair of building b)wages paid for white… Which of the following is a revenue expenditure. It`s important for the company to know how to use the cash flow. Capital expenditure (CapEx) is a payment for goods or services recorded—or capitalized—on the balance sheet instead of expensed on the income statement. Solution for Which of the following is a capital expenditure? The range of current production or manufacturing activities is mainly a result of past capital expenditures. Wages paid for white washing of building . This includes tangible and intangible assets Example acquisition of building, land, deliver van. (i) Store fixtures bought (ii) Wages of shop assistants (iii) The purchase of a new van (iv) Petrol for van . Extension to building Depreciation of machinery Electricity expenses 52 incurring these expenditures are utilized by the business a. And prepare for your objective type exams, interviews and to clear your concepts opex, are... Expensed on the income statement flow and capital expenditure Debt service expenditures Prepayments. 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