Capital and revenue expenditure Capital Expenditures The expenditure which generates revenue or income is called capital revenue. It is incurred either for buying permanent assets or for improving their existing working capacity. It helps to increase production. Items related to capital Expenditures; 1. Expenditure and incurred in buying , transporting and installing a permanent assets. 2. Expenditure incurred in overhauling and installing an old asset to put in production process. 3. Cost of Registration and legal charges incurred in buying or constructing a permanent assets. 4. Expenditure incurred in improving or extending the working capacity of an existing assets. 5. Expenditure incurred in getting benefits over a number of years. Revenue expenditure Any expenditure incurred in connection with the operation and administration of daily activities of the business is called revenue expenditure. It is incurred for maintaining earnings capacity and working efficiently of fixed ass...
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