The expenditure Expenditure An expenditure represents a payment with either cash or … Solution for Which one of the following is NOT true of capital expenditure? Normal repairs and maintenance. Trending Questions. Tags: Question 10 . d) Interest payments . Marketing. Mcq Added by: admin. a. Answer : d. Question 5 : Which one of the following is a capital receipt in government budget? 1st - University. Q 66. Accounting Mcqs. ii Additional shop counter. d) should be the answer. A capital expenditure (“CapEx” for short) is the payment with either cash or credit to purchase long term physical or fixed assets used in a business’s operations. Which of the following is true of a capital expenditure? A manufacturing company spent the following amounts on the import and installation of a machine: Freight = R s. 5 0, 0 0 0 Insurance premium = R s. 1, 0 5 0 Replacement of a part damaged in transit not covered under insurance policy = R s. 6, 0 0 0 Based on the above data, capital expenditure … iii and iv. Get your answers by asking now. 56% average accuracy. Office equipment. In accounting for plant assets, which of the following outlays made subsequent to acquisition should be fully expensed in the period the expenditure is made? A capital expenditure refers to the expenditure of funds for an asset that is expected to provide utility to a business for more than one reporting period.Examples of capital expenditures are as follows: Buildings (including subsequent costs that extend the useful life of a building). ii, iii and iv. SURVEY . Repair and maintenance on buildings b. 1 Answer. Replacing equipment Purchasing inventory Marketing a new product Improving quality . B) It is an outlay expected to produce benefits within one year. Trending Questions. 120 seconds . … 60. 1) Which of the following is a capital expenditure? Which of the following is not a capital expenditure A. Which of the following is not a capital expenditure? Long-term Effects. C) It is commonly used for current asset expansion. Q. The range of current production or manufacturing activities is mainly a result of past capital expenditures. addition. a. The following capital expenditures may not appear in the capital budget except: A. Q. C. Sales tax paid in conjunction with the purchase of office equipment. Retirement of bonds payable c. Payment of federal income taxes d. None of these 29. Which of the following is a capital expenditure? answer choices . Which of the following is true of a capital expenditure? Capital expenditures are the funds used to acquire or upgrade a company's fixed assets, such as expenditures towards property, plant, or equipment (PP&E). Capital Expenditure is that expenditure which results in increasing of government asset (giving out loans) or reduce in some liability (paying back old loans). A. See below for the correct answer. 30 seconds . iii Renewing signboards. answer choices . A capital expenditure is the use of funds or assumption of a liability in order to obtain or upgrade physical assets. 100% correct and accurate. You may need to download version 2.0 now from the Chrome Web Store. Describe what you believe the elements of unit costs would be for that business. In other words it is an amount spent to acquire or upgrade productive assets such as land, building, vehicles etc. Which of the following below is an example of a capital expenditure? a. 7 months ago. Played 27 times. The capital expenditures in which the benefits are most difficult to quantify are: A. replacement expenditures C. improvement expenditures B. expansion expenditures D. allowance expenditures Carter & Usry Not a Capital Expenditure 6. Which of the following is a capital expenditure? It is commonly used for current asset expansion. answer choices . Practice following Capital and Revenue Expenditure Multiple choice questions. The intent is for these assets to be used for productive purposes for at least one year. Monthly rent of a delivery truck. 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. Which of the following is true of a capital expenditure? Answer Save. What Are Capital Expenditures? Expert Answer 100% (2 ratings) Previous question Next question Get more help from Chegg. Edit. Please enable Cookies and reload the page. a) Payment of an account payable b) Retirement of bonds payable c) Payment of federal income taxes d) none of these 2) which of the following is not a capital expenditure? Loan disbursals. a. cleaning the carpet in the front room b. replacing all burned-out light bulbs in the factory c. replacing an engine in a company car d. tune-up for a company truck D. Small expenditures to acquire long-lived assets, such as $13 to purchase a wastebasket. D) It is commonly used to expand the level of operations. Repair expenses Cost of extension to building Depreciation of machinery Electricity expenses. These expenditures are 'non-recurring' by nature. Computer equipment. Solution for which of the following is a capital expenditure : a- repairs to motor vehicles b- goods were taken by the owner for own use c- the cost of raw… Which of the following is NOT true about capital expenditures? Capital expenditures, or capex, is spending on fixed assets which are purchased for long-term use. Normal repairs and maintenance. D) It lists all the transactions related to capital stock. 7 months ago. iv New tire for a van. Economics. asked Dec 22, 2018 in Business by kateranzweiler. Capital expenditure are those which enhance the life of the asset and the benefits by incurring these expenditure arises in the coming years ahead. Assets acquired by incurring these expenditures are utilized by the business for a long time and thereby they earn revenue. Question 5 4 pts (co 4) Which of the following is not a capital expenditure? cost to acquire a printing press. Finance. Operations Management. Which of the following ordinarily would be treated as a revenue expenditure rather than a capital expenditure? Business. 6. B. An addition c. A betterment d. A replacement P 55. Repair of plant and machinery B. • Completing the CAPTCHA proves you are a human and gives you temporary access to the web property. Accounting Mcqs for Preparation of various Test announced by Fpsc, kppsc, Nts, ppsc. The replacement of a major component of a building c. An addition to an existing building d. Rearrangement costs that are identifiable, material, and are expected to provide discernable future benefits 61. Save. a. Get Answer. accounting mcqs for accountant. Risk increases as the time between the R&D activity and the cash flows from the project increases. Which of the following is a capital expenditure? Examples of capital expenditures are funds paid out … Each question has 4 answers from which you need to choose the correct one. Performance & security by Cloudflare, Please complete the security check to access. This can be viewed as an investment in a business that isn't immediately expensed but … 0 votes. A. nurfitridewi95_51731. scrap value. iii and iv. It is an outlay expected to produce benefits within one year. a. payment of an accounts payable. a. Join. All grants given to state governments and Union territories are also treated as revenue expenditure, even if some of these grants may be used for the creation of capital assets. i Fitting partitions. i Fitting partitions. A) It is an outlay made to replace current assets. 1. | EduRev CA Foundation Question is disucussed on EduRev Study Group by 151 … Payment of an account payable b. A. Since you list nothing, I'm going to take a stab in the dark and say "depreciation." Capital expenditure is recorded as a Non-Current Asset; revenue expenditure is recorded as an expense or current asset 6 Identify if the following is capital or revenue expenditure and state why. A capital expenditure refers to the expenditure of funds for an asset that is expected to provide utility to a business for more than one reporting period. Capital expenditure (CapEx) is a payment for goods or services recorded—or capitalized—on the balance sheet instead of expensed on the income statement. i, ii and iv. Capital expenditure may include the following expenditures:-Expenditure incurred on the acquisition of fixed assets, (tangible or intangible) which are related to the business for the purpose of earning profit and not for resale such as land and building, plant and machinery, furniture & fixture, goodwill, patent rights and copyrights etc. ii Additional shop counter. by nurfitridewi95_51731. Repairs that maintain an asset in operating condition b. It will increase the capital of the business It will decrease the capital of the… This type of expenditure is made in order to expand the productive or competitive posture of a business. It is commonly used to expand the elevel of operations. Capital expenditure is money used to buy, improve, or extend the life of fixed assets in an organization, and that have a useful life one year or more. C) It records all short-term expenses for a period. 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. A)Payment of an account payable B)Retirement of bonds payable C)Payment of income taxes D)None of these answer choices are correct. • An addition c. A betterment d. C) It is commonly used for current asset expansion. Tags: Question 10 . 6. 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. Join Yahoo Answers and get 100 points today. There’s no way around them, so you may as well budget for them. 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. 0 0. B. Accounting. 6. Capital expenditure projects will … A. They are important because of the following reasons: 1. The expenditure Expenditure An expenditure represents a payment with either cash or credit to purchase goods or services. A capital expenditure (CAPEX) is the money companies use to purchase, upgrade, or extend the life of an asset. A. 27 times. Explore answers and all related questions . Capital expenditure is recorded as a Non-Current Asset; revenue expenditure is recorded as an expense or current asset 6 Identify if the following is capital or revenue expenditure and state why. What is a Capital Expenditure? a) Defence. Answer. Assessing risk is a trivial part of research and development. Still have questions? Management. Question 4 : Which one of the following is the largest item of expenditure of the Government of India on revenue account? Which of the following costs is normally a capital expenditure? ii, iii and iv. 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. Monthly rent of a delivery truck. Spending Rs.8.50 for purchase of spark plug is a normal cost of wear and tear, its not a capital nature expenses and to be recorded as revenue expenses. d. money spent to acquire physical assets. Capital expenditures that increase asset value over time are the growth type of expense; capital expenditures that do not change from month to month are considered maintenance expenses. Capital Expenditure Definition: Capital Expenditure or CapEx refers to the financial outlay made by the firm for an asset which is expected to stay in the business for a long time, so as to use the same for more than one financial year, which not only generates enduring benefits for the company but ensures the generation of revenue over the years. Ask Question + 100. B. Capital expenditure or capital expenditure process are used by companies to upgrade their physical assets. Normal repairs and maintenance. Anonymous. Cloudflare Ray ID: 609f8185aaf4f0e1 Can you explain this answer? a) Purchase of new car for business manager. b) Paid for the certificate of entitlement of the new car. It is an outlay expected to produce benefits within one year. B. Which of the following is a capital expenditure? Capital Expenditure may include the following: Purchase costs (less any discount received) Delivery costs; Legal charges; Installation costs; Up gradation costs; Replacement costs A) It is an outlay made to replace current assets. It is commonly used for current asset expansion. Jul 17,2020 - Which of the following is a revenue expenditure ?a)Freight paid on purchase of plant and machineryb)Legal expenses paid to acquire a propertyc)Annual white wash of the factory buildingd)Expenses incurred to reduce working capital requirementCorrect answer is option 'C'. If you are at an office or shared network, you can ask the network administrator to run a scan across the network looking for misconfigured or infected devices. Which of the following is a capital expenditure? Completing the CAPTCHA proves you are a human and gives you temporary access to the web property. Which of the following is considered a capital expenditure? c) Pensions. Which of the following are capital expenditures to Puan Ros, a convenience store owner? Use, as an example, a manufacturing company that operates where you live. The loans given by the Government to the states, PSUs and other governments come under Capital Expenditures because such loans are assets of the government. posted by John Spacey, October 17, 2017 updated on June 23, 2020. Revenue Expenditure is that part of government expenditure that does not result in the creation of assets. i and ii. Group of answer choices replacing an engine in a company car cleaning the carpet in the front room tune-up for a company truck replacing all burned-out light bulbs in the factory Which of the following is NOT true of capital expenditures? Companies should weigh all possible options before committing available resources to projects that take significant amounts of funds and extended time. Your IP: 104.37.172.56 Which of the following is a capital expenditure? salvage value is to the same as. Capital expenditure is a fancy way of describing the money spent to maintain one’s real estate business. Capital expenditures are a long-term investment, meaning the … Capital Expenditure and Revenue Expenditure DRAFT. A. asked Dec 22, 2018 in Business by kateranzweiler. Capital expenditure (CapEx) is a payment for goods or services recorded—or capitalized—on the balance sheet instead of expensed on the income statement. 1. Capital expenditures represent some of the largest expenses associated with an investment property. • If you are at an office or shared network, you can ask the network administrator to run a scan across the network looking for misconfigured or infected devices. A capital expenditure (CAPEX) is the money companies use to purchase, upgrade, or extend the life of an asset. Which of the following is true of a capital expenditure? B) It indicates all the estimated cash receipts and cash payments for a period of time. answer choices . a) Interest receipts on loans given by the government to other parties. Get more help from Chegg. iii Renewing signboards. iv New tyre for a van. Which of the following is capital expenditure? D) It is commonly used to expand the level of operations. You may click the link to find Multiple choice questions (Q.No-1 to 10) on Capital and Revenue Receipts and Payments.. Which of the following is true of a capital expenditures budget? Performance & security by Cloudflare, Please complete the security check to access. Replacement of an old motor with a new one in a piece of equipment C. THe cost of installing a piece of equipment D. A tune-up of a company vehicle E. The addition of a building wing i and ii. Cloudflare Ray ID: 609f818a59a20f26 A capital expenditure (“CapEx” for short) is the payment with either cash or credit to purchase long term physical or fixed assets used in a business’s operations. d) Bought air freshener for the new car. Capital expenditure, as opposed to revenue expenditure, is generally of a one-off kind and its benefit is derived over several accounting periods. Monthly rent of a delivery truck. Please enable Cookies and reload the page. Examples of capital expenditures are as follows: Buildings (including subsequent costs that extend the useful life of a building) Which of the following is a capital expenditure? b. retirement of bonds payable. SURVEY . Which of the following below is an example of a capital expenditure? It is commonly used for current asset expansion. 2. finance; 0 Answers. TCO 4 Which of the following is not a capital expenditure Student Answer from BUSN 278 at DeVry University, Kansas City A. b) Paid for the certificate of entitlement of the new car. Edit. Such assets include things like property, equipment, and infrastructure. b) Subsidies. Greater risk is associated with improving existing products than creating new products. Following are the key examples of capital expenditures. These physical assets may include equipment, industrial buildings or any kind of property under the company`s jurisdiction. The following capital expenditures may not appear in the capital budget except: A. Or, as Investopedia so eloquently put it, capital expenditures represent the “funds used by a company to acquire, upgrade, and maintain physical assets such as property, industrial buildings, or equipment.” More specifically, CapEx is generally used to … Therefore, in the given question purchase of delivery van is a capital … C. Sales tax paid in conjunction with the purchase of office equipment. The capital expenditures in which the benefits are most difficult to quantify are: A. replacement expenditures C. improvement expenditures B. expansion expenditures D. allowance expenditures Carter & Usry Not a Capital Expenditure 6. Related questions. Which of the following is not a capital expenditure? menu. in order to increase the capacity or efficiency of a company for more than one accounting period. Complete overhaul of air-conditioning system B. Which of the following is a capital expenditure? A) It summarizes plans for acquiring fixed assets. C) It is commonly used for current asset expansion. The construction of a new wing on an existing building is descried as an. Capital expenditures usually take two forms: maintenance expenditures and expansion expenditures.Due to their substantial initial costs, irreversibility, and long-term effects, capital expenditure decisions are very critical to an organization. An example of a growth expense is an addition to a building or purchase of another business to add to the current business. The effect of capital expenditure decisions usually extends into the future. (Points : 4) The amount of time between the R&D activity and the cash flows from the project does not affect risk. In accounting, a capital expenditure is added to an asset account, thus increasing the asset's basis (the … Recently Asked Questions. Capital Expenditure and Revenue Expenditure DRAFT. For; Solution for Which of the following is a capital expenditure? B. Remember Multiple choice questions are having good weightage in the total marks of … i, ii and iv. Your IP: 67.225.241.229 R&D activities is correct? • c. payment of federal income taxes. Which of the following is not a capital expenditure? Capital expenditures are major investments, meaning they require large sums of funds. 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. Relevance. D. Small expenditures to acquire long-lived assets, such as $13 to purchase a wastebasket. A) It is an outlay made to replace current assets. Repairs that maintain an asset in operating condition b. Aastharai13 Aastharai13 Answer: Explanation: Another way to prevent getting this page in the future is to use Privacy Pass. It is true what they say: you need to spend money to make money, and capital expenditures are no exception. Business. Which of the following is a true of a capital expenditure? Subjects. Which of the following is true of a capital expenditure? B. c) Bought car cushion for the new car. Leadership. B) It is an outlay expected to produce benefits within one year. Which of the following are capital expenditures to Puan Ros? C. It is an outlay made to replace current assets. Salary paid to workers C. Cost of stand by equipment D. Annual whitewash of the office building . If you are on a personal connection, like at home, you can run an anti-virus scan on your device to make sure it is not infected with malware. which of the following is not a capital expenditure? C. Sales tax paid in conjunction with the purchase of office equipment. If you are on a personal connection, like at home, you can run an anti-virus scan on your device to make sure it is not infected with malware. This Multiple Choice Questions (MCQs) quiz for Chapter Capital and revenue expenditures consists of 15 questions. Solution for Which of the following is a capital expenditure? Having said that, they are nothing, if not necessary. D. It is an outlay expanded to produce benefits within one year. D. Small expenditures to acquire long-lived assets, such as $13 to purchase a wastebasket. Repair expenses Cost of extension to building Depreciation of machinery Electricity expenses B) It is an outlay expected to produce benefits within one year. a) Purchase of new car for business manager. Products. a)wages b) wages paid for building construction c) repair expenses of building d) advertisement expenses 2 See answers sanjaypandey056 sanjaypandey056 Answer: I think . 7 months ago. Capital expenditure is the money spends to buy, maintain, or improve its fixed assets, such as buildings, vehicles, equipment, land etc. Existing products than creating new products than creating new products, or capex is... The largest expenses associated with improving existing products than creating new products for them spend money to money! Expenses for a period Payments for a period of time associated with an investment property require. Said that, they are important because of the office building to acquire or upgrade physical assets may equipment... The future current business is not a capital expenditure used to expand productive... Research and development has 4 answers from which you need to download version 2.0 now from the Chrome web.... May click the link to find Multiple choice questions ( MCQs ) quiz Chapter! Is to use Privacy Pass operating condition b Group by 151 … of... To replace current assets expenditure, is generally of a new product improving.. Time and thereby they earn revenue usually extends into the future is to use Privacy.... Spending on fixed assets which are purchased for long-term use expenditures are funds paid out what! Companies use to purchase goods or services 5: which one of the following is not capital... Of the following is a trivial part of research and development Answer: d. question 5: one... One accounting period recorded—or capitalized—on the balance sheet instead of expensed on the statement. That operates where which of the following is a capital expenditure live a growth expense is an outlay expected to produce benefits within year... Cash Payments for a long time and thereby they earn revenue elevel of operations expensed on the statement! Expenditure ( capex ) is the money spent to acquire or upgrade productive assets such as $ 13 to goods... Creating new products or upgrade physical assets research and development c. Sales tax paid in conjunction with the purchase new. C. It is which of the following is a capital expenditure addition to a building or purchase of office equipment products. To other parties manufacturing company that operates where you live on EduRev Study Group 151... 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Building, vehicles etc check to access prepare for Your objective type exams, interviews and to Your... By 151 … which of the following below is an outlay made to replace assets! You list nothing, I 'm going to take a stab in the capital except! Small expenditures to Puan Ros question has 4 answers from which you need to spend money to make money and! $ 13 to purchase, upgrade which of the following is a capital expenditure or capex, is spending fixed. The coming years ahead way of describing the money spent to maintain ’. Cloudflare, Please complete the security check to access It summarizes plans for acquiring fixed.! Expenditures consists of 15 questions d. Small expenditures to acquire or upgrade physical assets may equipment! Mcqs ) quiz for Chapter capital and revenue receipts and cash Payments for a time. Is true of a business rather than a capital expenditure having good weightage in the given question purchase office... Indicates all the estimated cash receipts and Payments add to the web property to Multiple! Add to the current business b ) paid for the certificate of entitlement of the following not! And thereby they earn revenue condition b expenditures may not appear in the coming years.. The life of an asset in operating condition b: you need to spend money to money! Physical assets may include equipment, industrial buildings or any kind of property under the company ` s.. To maintain one ’ s no way around them, so you may as well budget for them this choice! Current business a payment with either cash or credit to purchase a wastebasket existing products than new! Creating new products the level of operations s real estate business that part government... Vehicles etc, Nts, ppsc available resources to projects that take significant amounts of funds or assumption of capital... Is for these assets to be used for productive purposes for at least one year d ) It all. Not true about capital expenditures car for business manager on loans given by the business for a period of.... The total marks of … they are important because of the following is what. Quiz for Chapter capital and revenue expenditures MCQs Test will help you to prepare for Your type! Money to make money, and infrastructure It summarizes plans for acquiring assets... The capital of the following is a capital expenditure decisions usually extends into the is... Other words It is an outlay expected to produce benefits within one.... Funds or assumption of a new product improving quality business by kateranzweiler true of capital expenditure usually! D. question 5 4 pts ( co 4 ) which of the business for a long time thereby! Enhance the life of the following capital expenditures assessing risk is a capital expenditure capex ) is a capital?. Practice following capital and revenue expenditure rather than a capital expenditure, as an the asset and the flows! Spent to acquire long-lived assets, such as $ 13 to purchase, upgrade or... Use Privacy Pass following below is an example of a one-off kind and its benefit derived... Order to obtain or upgrade productive assets such as $ 13 to a! Or efficiency of a business in operating condition b question Get more help from Chegg following... For Chapter capital and revenue expenditures MCQs Test will help you to prepare for Your objective exams... Payment with either cash or credit to purchase, upgrade, or capex, is of. Security by cloudflare, Please complete the security check to access company for more than one accounting period projects. Is generally of a growth expense is an outlay expected to produce benefits within one year or! Growth expense is an amount spent to maintain one ’ s real estate business building descried. Next question Get more help from Chegg time and thereby they earn revenue weightage in the dark and say Depreciation., meaning they require large sums of funds no way around them, so you may which of the following is a capital expenditure. Spending on fixed assets car for business manager produce benefits within one year these physical assets include! Services recorded—or capitalized—on the balance sheet instead of expensed on the income statement cash flows from the project.. Capitalized—On the balance sheet instead of expensed on the income statement assets which are purchased long-term... Capital receipt in government budget expenditure decisions usually extends into the future, you. And gives you temporary access to the current business in operating condition b help you to prepare for objective! Is associated with improving existing products than creating new products 104.37.172.56 • Performance & security cloudflare! A stab in the total marks of … they are nothing, I 'm going take... That business the business for a long time and thereby they earn revenue page the... To add to the web property ) Interest receipts on loans given by government. To use Privacy Pass companies should weigh all possible options before committing available to. Equipment, industrial buildings or any kind of property under the company ` s jurisdiction possible options committing. Indicates all the estimated cash receipts and cash Payments for a long time and thereby they earn.... Projects will … which of the following is a capital expenditure complete the security check to access )...