D. Rent of a factory. Which of the following is a capital expenditure? The legal life of most patents is: A. Purchase of a goods. The range of current production or manufacturing activities is mainly a result of past capital expenditures. Capital expenditure may include the following expenditures:-Expenditure incurred on the acquisition of fixed assets, ... All expenses incurred in the ordinary conduct of business, such as rent, salaries, wages, manufacturing expenses, carriage, commission, legal charges, insurance and advertisement, free samples, salaries, postage expenses etc. b. Wages for construction of building. It comprises of the costs incurred for the purchase of different fixed assets. A second hand car is purchased for Rs. Assume that a honey producer sells its annual harvest to an Internet retailer for $70,000. 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. Wages paid for installation of machinery. D. Small expenditures to acquire long-lived assets, such as $13 to purchase a wastebasket. These expenditures are 'non-recurring' by nature. Purchase of goods . Click here to get an answer to your question ️ Which of the following is the capital expenditure? (iii) Repayment of Loan taken from World Bank. Analyze the current market position of WAPDA by using Bottom Up Approach and Top Down Approach. Recently Asked Questions Note: Billings per year are stated as percentages of the contract price. D. Both (a) and (b) Answer. The following are capital expenditures EXCEPT the ... answer choices . When an economy is experiencing higher real interest rates, business firms will most likely be discouraged from investing in: tangible and/or intangible capital. 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. 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 Still, do not forget that it`s an industry-specific ratio. Click hereto get an answer to your question ️ Identify the following as revenue expenditure and capital expenditure. Each question has 4 answers from which you need to choose the correct one. A. SURVEY . D. Rent of a factory. 2. Following are the examples of revenue expenditure. Capital Expenses or Expenditures are payments by a business for fixed assets, like buildings and equipment. 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? Assets acquired by incurring these expenditures are utilized by the business for a long time and thereby they earn revenue. d. Depreciation. 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. Which of the following is a revenue expenditure. Which of the following is a capital expenditure? 500 is incurred to get the car registered in owner's name and Rs. 53. (i) Salary paid to Army officers. Assembly b. C) repairs of motor vehicle. The cash flow and capital expenditure constantly go through the business cycles of a company life. 52. B. (i) The cost of an asset Rs.23,000 has been taken as an expense Which of the following are of capital nature? Similarly, the current decisions on capital expenditure will have a major influence on the future activities of the company. Which of the following is not a capital expenditure? Related Questions to study. Oil to lubricate machines. c. Salaries and wages. The retailer, in turn, brings in $105,000 from selling the honey directly to final customers. Consumer expenditures make up 71% of total expenditures while wages account for 59% of total income. Expenditure incurred to acquire fixed assets for the company. A) salaries and wages. Power required to run machine or motor. Pages 34. Top Answer (i) Store fixtures bought (iii) The purchase of a new van . Capital expenditure (CapEx) is a payment for goods or services recorded—or capitalized—on the balance sheet instead of expensed on the income statement. The correct answer is D. Related: Practice and Prepare For Your Upcoming Exams; Previous Question . However, amount of wages and salaries paid for the erection … 1,000 is spent on its repairs, Rs. Uploaded by: Madhuramohan. Stop wondering, read and find out how to get a quick soft loan in Nigeria. It`s important for the company to know how to use the cash flow. Solution for Which of the following expenditure is not capital expenditure for equipment? excess supply. This Capital and revenue expenditures MCQs test will help you to prepare for your objective type exams, interviews and to clear your concepts. 30 seconds . Assume a governmental entity enter into a capital lease for the purchase of seven new public safety vehicles. Uploaded by: darrenkanjithara. 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. 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. (ii) Purchase of Metro coaches from Japan. B. a. 10,000, the amount of Rs. The greater capital expenditure for a firm, the lesscash flow it can use. 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. d. Depreciation. Installation of an air conditioning system. 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 . 21.Which of the following is capital expenditure? Cost of repair . 3. It is considered a capital expenditure when the asset is newly purchased or when money is used towards extending the useful life of an existing asset, such as repairing the roof. Payment for Machinery. a. This includes tangible and intangible assets Example acquisition of building, land, deliver van. Cost of repairs. The following are capital expenditures EXCEPT the ... answer choices . Renovation of office space. They are important because of the following reasons: 1. Wages paid to factory workers. Practice important Questions. Capital Expenditure. Wages and Salaries Machine Maintenance Purchasing raw material Factory Equipment. Salaries and wages. 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. Expenditure incurred in the ordinary conduct and administration of business, i.e. Q. Answered By . 5 years. Which of the following is not capital expenditure? (v) Loan given to Union Territories. 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