Capital and Revenue Expenditure: Self-Test

[ACCA_Tutor]

State whether each of the following transactions will be classified as revenue expenditure or capital expenditure:

1. Purchase of land

2. Purchase of stationery

3. Purchase of machinery for resale

4. Purchase of furniture for use in the business

5. Purchase of equipment for stock

6. Purchase of goods

7. Purchase of a lorry

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ACCA Tutor

[shaheen]

I've always had problem with this topic when I was in HSC.....anyway,lets get started.

1. Purchase of land: capital expenditure

2. Purchase of stationery: revenue expenditure

3. Purchase of machinery for resale: revenue expenditure

4. Purchase of furniture for use in the business: capital expenditure

5. Purchase of equipment for stock: revenue expenditure

6. Purchase of goods: revenue expenditure

7. Purchase of a lorry: capital expenditure

[ACCA_Tutor]

Hi Shaheen!

EXCELLENT!

You've scored full marks.

Thanks for having the guts to test yourself.

As learning is never-ending, we hope that you will continue to use this website to keep yourself up-to-date!


Regards,
ACCA Tutor