Salary paid to workers C. Cost of stand by equipment D. Annual whitewash of the office building . A) It is an outlay made to replace current assets. ii Additional shop counter. c) Pensions. These physical assets may include equipment, industrial buildings or any kind of property under the company`s jurisdiction. • 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. … You may click the link to find Multiple choice questions (Q.No-1 to 10) on Capital and Revenue Receipts and Payments.. Operations Management. Accounting. d) Bought air freshener for the new car. Economics. Tags: Question 10 . Which of the following is a capital expenditure? 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? Subjects. Capital expenditures represent some of the largest expenses associated with an investment property. Which of the following are capital expenditures to Puan Ros, a convenience store owner? Mcq Added by: admin. Management. TCO 4 Which of the following is not a capital expenditure Student Answer from BUSN 278 at DeVry University, Kansas City Describe what you believe the elements of unit costs would be for that business. 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. In accounting, a capital expenditure is added to an asset account, thus increasing the asset's basis (the … answer choices . a) Purchase of new car for business manager. i Fitting partitions. Solution for Which of the following is a capital expenditure? A)Payment of an account payable B)Retirement of bonds payable C)Payment of income taxes D)None of these answer choices are correct. Finance. C) It is commonly used for current asset expansion. Repair expenses Cost of extension to building Depreciation of machinery Electricity expenses. It is commonly used to expand the elevel of operations. Which of the following is true of a capital expenditures budget? C. Sales tax paid in conjunction with the purchase of office 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… answer choices . a. SURVEY . B) It is an outlay expected to produce benefits within one year. A) It is an outlay made to replace current assets. Loan disbursals. Which of the following is not a capital expenditure? Normal repairs and maintenance. Complete overhaul of air-conditioning system B. Products. Join Yahoo Answers and get 100 points today. C) It is commonly used for current asset expansion. b. retirement of bonds payable. answer choices . 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. Which of the following is a true of a capital expenditure? iii Renewing signboards. Which of the following is true of a capital expenditure? Which of the following is NOT true of capital expenditures? Save. Related questions. 30 seconds . It is commonly used for current asset expansion. i Fitting partitions. The construction of a new wing on an existing building is descried as an. Join. 100% correct and accurate. Your IP: 104.37.172.56 Repair expenses Cost of extension to building Depreciation of machinery Electricity expenses 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. A. The following capital expenditures may not appear in the capital budget except: A. • What Are Capital Expenditures? A) It is an outlay made to replace current assets. which of the following is not a capital expenditure? Relevance. 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. ii, iii and iv. Still have questions? B. Completing the CAPTCHA proves you are a human and gives you temporary access to the web property. C. It is an outlay made to replace current assets. Remember Multiple choice questions are having good weightage in the total marks of … Question 4 : Which one of the following is the largest item of expenditure of the Government of India on revenue account? Long-term Effects. Risk increases as the time between the R&D activity and the cash flows from the project increases. 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 (CAPEX) is the money companies use to purchase, upgrade, or extend the life of an asset. Capital expenditures, or capex, is spending on fixed assets which are purchased for long-term use. Q 66. Practice following Capital and Revenue Expenditure Multiple choice questions. Recently Asked Questions. a. 6. (Points : 4) The amount of time between the R&D activity and the cash flows from the project does not affect risk. 0 0. Which of the following is true of a capital expenditure? b) Subsidies. These expenditures are 'non-recurring' by nature. Anonymous. 1st - University. Assets acquired by incurring these expenditures are utilized by the business for a long time and thereby they earn revenue. Which of the following is true of a capital expenditure? asked Dec 22, 2018 in Business by kateranzweiler. ii, iii and iv. 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. Assessing risk is a trivial part of research and development. Cloudflare Ray ID: 609f818a59a20f26 SURVEY . Which of the following is a capital expenditure? scrap value. B) It indicates all the estimated cash receipts and cash payments for a period of time. Repairs that maintain an asset in operating condition b. An addition c. A betterment d. 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. 0 votes. Accounting Mcqs. See below for the correct answer. answer choices . Which of the following is a capital expenditure? An addition c. A betterment d. A replacement P 55. 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. 1) Which of the following is a capital expenditure? D. It is an outlay expanded to produce benefits within one year. b) Paid for the certificate of entitlement of the new car. 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. 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. Since you list nothing, I'm going to take a stab in the dark and say "depreciation." D) It lists all the transactions related to capital stock. Which of the following is considered a capital expenditure? iv New tire for a van. Which of the following is a capital expenditure? The range of current production or manufacturing activities is mainly a result of past capital expenditures. D) It is commonly used to expand the level of operations. B) It is an outlay expected to produce benefits within one year. 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. B. Capital expenditure are those which enhance the life of the asset and the benefits by incurring these expenditure arises in the coming years ahead. 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 … This can be viewed as an investment in a business that isn't immediately expensed but … 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 Another way to prevent getting this page in the future is to use Privacy Pass. They are important because of the following reasons: 1. Capital Expenditure and Revenue Expenditure DRAFT. Computer equipment. • nurfitridewi95_51731. Get your answers by asking now. 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. 7 months ago. Capital expenditure projects will … Examples of capital expenditures are funds paid out … 7 months ago. Capital expenditures are major investments, meaning they require large sums of funds. Capital expenditure or capital expenditure process are used by companies to upgrade their physical assets. D) It is commonly used to expand the level of operations. Which of the following is a capital expenditure? Trending Questions. It is an outlay expected to produce benefits within one year. a. Answer Save. Which of the following is capital expenditure? Monthly rent of a delivery truck. Leadership. The expenditure Expenditure An expenditure represents a payment with either cash or credit to purchase goods or services. B. b) Paid for the certificate of entitlement of the new car. 6. Edit. Which of the following is capital expenditure? 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 is the money spends to buy, maintain, or improve its fixed assets, such as buildings, vehicles, equipment, land etc. Normal repairs and maintenance. 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'. asked Dec 22, 2018 in Business by kateranzweiler. Question 5 4 pts (co 4) Which of the following is not a capital expenditure? salvage value is to the same as. a. payment of an accounts payable. Retirement of bonds payable c. Payment of federal income taxes d. None of these 29. Which of the following costs is normally a capital expenditure? Which of the following are capital expenditures to Puan Ros? Which of the following is not a capital expenditure A. Aastharai13 Aastharai13 Answer: Explanation: 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. Solution for Which of the following is a capital expenditure? It is commonly used for current asset expansion. What is a Capital Expenditure? Which of the following is a capital expenditure? Having said that, they are nothing, if not necessary. Monthly rent of a delivery truck. iii Renewing signboards. C) It is commonly used for current asset expansion. Monthly rent of a delivery truck. Cloudflare Ray ID: 609f8185aaf4f0e1 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. A capital expenditure is the use of funds or assumption of a liability in order to obtain or upgrade physical assets. Therefore, in the given question purchase of delivery van is a capital … Please enable Cookies and reload the page. Explore answers and all related questions . The expenditure Expenditure An expenditure represents a payment with either cash or … 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. Which of the following is not 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). Played 27 times. Which of the following is a capital expenditure? Companies should weigh all possible options before committing available resources to projects that take significant amounts of funds and extended time. It is commonly used for current asset expansion. Business. 7 months ago. B. 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. Tags: Question 10 . 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 1 Answer. Your IP: 67.225.241.229 iv New tyre for a van. Which of the following is true of a capital expenditure? Repair of plant and machinery B. Capital expenditure, as opposed to revenue expenditure, is generally of a one-off kind and its benefit is derived over several accounting periods. ii Additional shop counter. Capital expenditure is a fancy way of describing the money spent to maintain one’s real estate business. 27 times. D. Small expenditures to acquire long-lived assets, such as $13 to purchase a wastebasket. Q. iii and iv. It will increase the capital of the business It will decrease the capital of the… i and ii. Repairs that maintain an asset in operating condition b. Can you explain this answer? It is an outlay expected to produce benefits within one year. 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 … 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. in order to increase the capacity or efficiency of a company for more than one accounting period. 60. Examples of capital expenditures are as follows: Buildings (including subsequent costs that extend the useful life of a building) 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 The intent is for these assets to be used for productive purposes for at least one year. Revenue Expenditure is that part of government expenditure that does not result in the creation of assets. d. money spent to acquire physical assets. Capital Expenditure may include the following: Purchase costs (less any discount received) Delivery costs; Legal charges; Installation costs; Up gradation costs; Replacement costs Office equipment. A. Edit. 1. 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? c) Bought car cushion for the new car. It is true what they say: you need to spend money to make money, and capital expenditures are no exception. A. The following capital expenditures may not appear in the capital budget except: A. Trending Questions. Repair and maintenance on buildings b. 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. accounting mcqs for accountant. D. Small expenditures to acquire long-lived assets, such as $13 to purchase a wastebasket. Each question has 4 answers from which you need to choose the correct one. Which of the following ordinarily would be treated as a revenue expenditure rather than a capital expenditure? i, ii and iv. 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. i, ii and iv. 56% average accuracy. d) should be the answer. Which of the following is true of a capital expenditure? Get Answer. D. Small expenditures to acquire long-lived assets, such as $13 to purchase a wastebasket. Capital expenditures are a long-term investment, meaning the … A. Accounting Mcqs for Preparation of various Test announced by Fpsc, kppsc, Nts, ppsc. Ask Question + 100. a. C. Sales tax paid in conjunction with the purchase of office equipment. iii and iv. posted by John Spacey, October 17, 2017 updated on June 23, 2020. Capital expenditure (CapEx) is a payment for goods or services recorded—or capitalized—on the balance sheet instead of expensed on the income statement. Performance & security by Cloudflare, Please complete the security check to access. Following are the key examples of capital expenditures. B. You may need to download version 2.0 now from the Chrome Web Store. 6. For; C. Sales tax paid in conjunction with the purchase of office equipment. 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. 120 seconds . Which of the following is a capital expenditure? The effect of capital expenditure decisions usually extends into the future. B. i and ii. 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). 2. Which of the following below is an example of a capital expenditure? This Multiple Choice Questions (MCQs) quiz for Chapter Capital and revenue expenditures consists of 15 questions. Please enable Cookies and reload the page. a) Interest receipts on loans given by the government to other parties. A. Which of the following is not a capital expenditure? 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. | EduRev CA Foundation Question is disucussed on EduRev Study Group by 151 … Normal repairs and maintenance. finance; 0 Answers. Use, as an example, a manufacturing company that operates where you live. Capital Expenditure and Revenue Expenditure DRAFT. A. a) Purchase of new car for business manager. addition. Answer. A capital expenditure (CAPEX) is the money companies use to purchase, upgrade, or extend the life of an asset. An example of a growth expense is an addition to a building or purchase of another business to add to the current business. A) It summarizes plans for acquiring fixed assets. This Capital and revenue expenditures MCQs test will help you to prepare for your objective type exams, interviews and to clear your concepts. 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