what is the capitla expenditure & revenue expenditure give
the 5 difference between capital & revenue expenditure and
also its example?
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Answer Posted / abdul rashid
A capital expenditure is an amount spent to acquire or
improve a long-term asset such as equipment or buildings.
Usually the cost is recorded in an account classified as
Property, Plant and Equipment.
A revenue expenditure is an amount that is expensed
immediately—thereby being matched with revenues of the
current accounting period. Routine repairs are revenue
expenditures because they are charged directly to an
account such as Repairs and Maintenance Expense. Even
significant repairs that do not extend the life of the
asset or do not improve the asset (the repairs merely
return the asset back to its previous condition) are
revenue expenditures.
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