What is the differance between Captial & revanue?
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Answer / h.r. sreepada bhagi
In Accounting the terms Capital & Revenue have a broader
meaning than just Owners Equity & Income.
Nature of the transaction may be Capital or Revenue - i.e.
it may be Capital Expenditure, Capital Receipt, Revenue
Expenditure or Revenue Receipt.
Capital Expenditure - Expenditure on Acquiring or Purchasing
Fixed Assets (Capital items)
Capital Receipt - Money Received on the sale or transfer of
Fixed Assets (Capital items)
Revenue Receipt - Money received in the ordinary course of
business from business operations.
Revenue Expenditure - Money spent in the ordinary course of
business to meet normal running expenses of the business.
Capital - The money invested in a business of profession or
any venture to earn profit by utilising the money for the
intended purpose.
Revenue - Simply Income or Receipt of money in the normal
course of operations.
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Answer / md. shah alam
Capital is the owners' equity and revenue is income for the
entity.
| Is This Answer Correct ? | 2 Yes | 1 No |
Answer / lakshmi
capital expenditure:it is simply the benifit which we are
getting from any asset and which lasts for a longer
period .the benifit from any machinery,computer systems
lasts for a longer time.
revenue expenditure:it burns in every year.items recorded
in p&la/c.
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can any one tell me what is the difference between Accounting period & Financial year? Will be waiting for your answer. It's an open source question, any correct answer will be appreciable. Thanks. Regards, Mr. RKO
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Trial balance as on 31st March, 2014 Particulars Debit Pula Particulars Credit Pula Wages 14 100 Dividends received 4 300 Salaries 13 000 Bank overdraft 41 000 Opening Stock 40 000 Returns 1 000 Machinery 49 000 Creditors 14 200 Investments 30 700 Sales 258 500 Drawings 23 000 Capital 30 000 Purchases 130 000 Returns 2 000 Debtors 18 000 Advertising 13 400 Interest 4 800 Cash 11 000 349 000 ======= 349 000 ======== Additional information: 1. Closing stock is valued at P53 000. 2. Wages include P350 being advance against wages. 3. Wages include P1 000 paid for erection of machinery. 4. A purchase of stationery for P430 has been inadvertently included in the Purchases account. 5. A sale of investments with a book value of P2 600 for P2 500 has been included in the Sales Account. 6. Salaries include P150 per month paid to the proprietor’s domestic servant. 7. Machinery is to be depreciated by 10 per cent. Required: a. The revenue statement (Trading and Profit and Loss Account) for the year ended 31st March 2014 and b. Statement of financial position (Balance Sheet) as on 31st March, 2014.
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