Distinguish capital and revenue expenditure



Distinguish capital and revenue expenditure..

Answer / Shabana

Capital expenditures are expenses incurred to acquire or maintain long-term assets that provide benefits over a period of more than one accounting period. Examples include purchasing property, plant, equipment, and intangible assets. Revenue expenditures are expenses incurred during the normal course of business that do not result in the creation of long-term assets or an increase in inventories. Examples include wages, rent, utilities, and supplies.

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