What is a capital expenditure versus a revenue expenditure?

Q: How should you record a capital expenditure? a. Debit a liability b. Debit capital c. Debit an…

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Q: How to calculate net present value with capital expenditures.

A: Capital expenditure refers to the amount incurred by the busi9ness in purchasing fixed assets for…

Q: Define the term capital expenditure.

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Q: Describe the Capital Expenditure process

A: Capital expenditure as the term suggest is a one time usually a balance sheet item. Usually a…

Q: Why is it necessary to make a distinction between Capital and Revenue Receipts and Capital and…

A: Capital receipts: These receipts are income that is earned from the investment and financing…

Q: What is the purpose of using the retained funds?

A: After paying the dividends, the company retains the remaining net income which is called addition to…

Q: hat does the term "miscellaneous expenditure" mean?

A: Miscellaneous Expenditure: These are the expenditure that are allowances for government services,…

Q: How should you record capital expenditure? Debit a liability Debit capital Debit an expense Debit…

A: Capital expenditure: Capital expenditure refers to the expenditures that are incurred to increase…

Q: How can we determine the net change in working capital requirements?

A: Working capital:Working capital refers to the excess amount of current assets over its current…

Q: the difference between capital expenditure and revenue expenditure.

A: Expenditure is defined as spending money on something. This can be a cash payment or the exchange of…

Q: Define capital expenditure

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Q: Explain how capital budgeting handles a gain or loss on disposal

A: This question explains about capital budgeting handles a gain or loss on disposal:

Q: What are the uses of funds?

A: The uses of fund are as follows: Purchase of fixed asset: If fixed assets such as plant and…

Q: The residual income amounted to?

A: Income is the amount remaining with the company from the Revenue after taking into consideration the…

Q: What is the difference between capital expenditure and revenue expenditure? Give an example of each.

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Q: What are the common internal controls in place for capital expenditure cycle? with explanations

A: Internal control is an important part of every organization. It helps in maintaining the efficiency…

Q: Discuss, using practical example how revenue expenditure should not be capitalized?

A: SOLUTION- Thus, a revenue expenditure which increases the utility or productive capacity of an…

Q: Why should the capital expenditures be capitalized?

A: Capital Expenditures:   Capital expenditures are those which provide future economic benefits by…

Q: Distinguish between the accounting for capital expenditures and revenue expenditures.

A: Fixed Assets: It refers to the long-term assets having a useful life of more than a year which is,…

Q: When does the Capital expenditures occur?

A: Capital expenditure is the money spent by business on acquiring fixed assets like land, building…

Q: TOTAL LEGAL CAPITAL

A: Legal capital means the par value of shares that cannot be distributed to the shareholders.

Q: What does Capital Recovery (Ownership) Cost?

A: Capital recovery cost It is an equivalent annual amount each year an asset must earn to recover…

Q: Calculate cost base, and capital gain (Loss), and capital gain tax, i

A: Capital gain/loss are the profits or rains arising from the transfer of a capital asset. It is the…

Q: How did the term working capital originate?

A: Introduction: Working capital can be defined as the necessary financial resources needed by a firm…

Q: What are the Capital Costs?

A: Cost:   Cost can be defined as the cash and cash equivalent which is incurred against the products…

Q: What is capital structure and why it is important?

A: Introduction: While selecting a capital structure main motive of the company is shareholders wealth…

Q: What is capital assets?

A: Capital asset means property of any kind like land, machinery, building, computer, vehicles,…

Q: When should the investment in working capital be treated as capital expenditure?

A: Working capital:   It is the form of capital used by the business for day-to-day operations. Working…

Q: Define how to record capital expenditure.

A: Capital expenditure: It refers to the amount spent on acquiring, maintaining, and improving the…

Q: What is an example or scenarios of Capital Allocation Line (CAL)?

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Q: What are the factor payments for land, labor, and capital?

A: The question is based on the concept of factor payment ,in financial economics factors are consider…

Q: Explain why it is important to distinguish between capital expenditure and revenue expenditure, and…

A: Expenditures: The Expenditures are the way of spending money on something, or the money that is…

Q: capital expenditure or a revenue expenditure.

A: Answer – Capital expenditures are those expenditure which improves the performance of assets and…

Q: What is net working capital?

A: Net working capital: Net working capital is also known as the working capital. To compute the net…

Q: Classify Revenue or capital expenditure?

A: Introduction: Revenue Expenditure: Its a Recurring expenditure. Expenditure spent with in 12 months…

Q: How much is the legal capital?

A: Legal capital refers to the par value/stated value of the shares issued.

Q: Distinguish between revenue and capital expenditures, and account for them.

A: Meaning of Expenditure Expenditure is the amount of various expenses incurred for the operations of…

Q: Explain, using practical example how Capital expenditure should be capitalized?

A: Capital expenditure can be defined as an expense made for the purchase of a long-term physical or…

Q: What does it mean when someone refers to acompany’s capital structure?

A: Every business needs money and funds in order to run its operations effectively. There are various…

Q: Explain the concept of capitalization effects?

A: Capitalization means recording an expense or cost on the assets side of the balance sheet and…

Q: Which one of the following is a revenue expenditure?

A: Revenue expenditure: It refers to the amount spent on normal maintenance and repairs of fixed assets…

Q: What is a simple capital structure?

A: Capital structure Capital structure refers to a combination or mix of equity and debt in order to…

Q: What are the effects of Working Capital?

A: A business needs to meet both short-term and long-term financial requirements.

Q: Describe the effects of Working Capital?

A: Working capital:- A business needs to meet short-term expenses and financial needs arising out of…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.