Question

Distinguish between capital expenditure and revenue expenditure

Answer 1

Answer:

The difference between capital expenditures and revenue expenditures. ... A capital expenditure is assumed to be consumed over the useful life of the related fixed asset. A revenue expenditure is assumed to be consumed within a very short period of time.

Explanation:

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Answer 2

Capital Expenditure is incurred for the purpose of increasing the earning capacity of the business. Revenue Expenditure is incurred for maintenance of earning capacity i.e. for keeping the assets in an efficient working order. Capital Expenditure yields benefit normally over a long period.