Day: January 3, 2024

Which of the following best explains what is meant by ‘capital expenditure?

Capital expenditure is expenditure…?

Select ONE answer:

1. On non-current assets, including repairs and maintenance
2. On expensive items over £10,000
3. On the acquisition of non-current assets, or improvement in their earning capacity
4. On items relating to owners’ capital

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct- Capital expenditure relates to the acquisition of, or improvement of, the earning capacity of non-current assets.
4. Not correct

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