Capital and Revenue Expenditure | PAPER III – ACCOUNTING & FINANCIAL MANAGEMENT FOR BANKERS | MODULE B: FINANCIAL STATEMENTS AND CORE BANKING SYSTEMS
Capital and Revenue Expenditure Notes Capital and Revenue Expenditure Expenditure Expenditure refers to the outflow of money or other assets in exchange for goods or services. In accounting, expenditures are classified as either capital or revenue expenditure. Distinction between Capital and Revenue Expenditure Capital Expenditure Revenue Expenditure Incurred to acquire or improve long-term assets Incurred for day-to-day operations Benefits extend beyond one accounting period Benefits are consumed within one accounting period Appears on the balance sheet Appears on the income statement Examples: Purchase of machinery, building construction Examples: Salaries, rent, utility bills ...