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capital and revenue expenditure presentation

This is so because repair and maintenance costs do not increase the earning capacity of the machine but only maintains it (i.e. Again, sometimes accountants may show revenue expenses as capital expenses for overstating the profit and getting incentives. The differences between capital expenditures and revenue expenditures include whether the purchases will be used over the long-term or short-term. The benefits of revenue expenditures usually expire within one financial year and their budget is smaller as compared to capital expenditures. Ramamohan . These are recurring in nature and are allocated to the profit and loss account of the same year. 2 0 obj Other transactions are of capital nature. Capital & Revenue expendituRe. Capital expenditures vs. revenue expenditures. Capital expenditures are usually one off and they include the substantial investments of money or capital that a government makes for the purpose of expansion in various sectors and different business in order to generate profits. endstream endobj startxref Remember Multiple choice questions are having good weightage in the total marks of … Cartage and Freight − If those are incurred to bring Fixed Assets. Activity slide could be used as a Plenary!!! Revenue expenditure • Day-to-day running of business. Expenditure means spending on something. Read more. 3 0 obj ���vdZe#���ۣ���cJ� �.���)�\�sঔ4B�)t��鷰!��c(.��"��6T��)>}�����2������Eea3��F/h�')�s��PS�Q� .Zk��.b����. Finance professionals can use this entirely editable deck to discuss how CapEx enhances the scope of operations for the business and generates revenue for many years by boosting operational efficiency. J�� �'(�6r�����vڈ6�hrB�@ XXY�X������Nq����7;� }M�Ci�!9>��29B�k�����!�Me��������j鱘..�K��V�|����fO��ۓ�F�����j��kwZ�;m� ���&K Business expenditures are accounted for in either one of the two ways. <> 3) Recorded in balance sheet Recording in Manufacturing, Trading or Profit and Loss A/c Weaknesses in revenue and expenditure management could constrain the ability of a municipality to contribute to poverty reduction and economic development. Capital expenditures; Revenue expenditures; Capital expenditures Definition and explanation of capital expenditures: An expenditure is a capital expenditure if the benefit of the expenditure extends to several trading years. %���� Free. I think it is better to go through this MCQ’s. x��Z[o�~7����bd�"))(ě�H��胷㙱��z�hf�����)�I봏�a["y���E�7�_}�������B�~��F��s#n�./r��ryq��?�͏�������*p0�UVV�����n//���ؿy�5����xR��J�:��GZ��J(T!�2� R,��d_���JmdE����4։W��n�-�b�-������VdŢ#K�4C^��ei�r��(/f�Rc���N�x�g����2�HU��qF�fK��ff��Ç� �X,�w�R/>>S�����^(�_�U�r�j^�Q_�Z��{�w䯀�Q�AF���ْ����'����=�w��v�ϖ�b�O-[j��dž*j\� �Fw܀zݠǞ�?���5-�U�����j�8�X�x� 2. Report a problem. View Chapter no. When an accountant consider revenue expenditure as capital expenditure, it will overstate the profit of the company and non-identifiable fixed assets will arise. endobj Describe the effect on final accounts, mainly on net profit, if revenue expenditure is wrongly treated as capital expenditure and vice versa. A D V E R T I S E M E N T. 4 Comments on . ‘Capital v Revenue expenditure’ is a term used throughout this toolkit. Capital Expenditure found in: Capital Expenditure Details Ppt PowerPoint Presentation Infographics Guide, Capital Expenditure Details Fy 18 Ppt PowerPoint Presentation Summary Themes, Capital Expenditure Valuation Methods Ppt.. Back to: Capital and revenue items (quizzes) Show your love for us by sharing our contents. Recurring or Regular expenditure. Capital and revenue items. <>/XObject<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/MediaBox[ 0 0 612 792] /Contents 4 0 R/Group<>/Tabs/S>> 5. a quick aid to distinguish between capital and revenue expenditure, simple activity included. %%EOF An expense is a word very similar to expenditure but expense shows the deduction in the value of the asset while expenditure simply denotes the obtaining of as… If you continue browsing the site, you agree to the use of cookies on this website. Multiple choice questions (MCQs) Chhavi sharma . What is a capital expenditure versus a revenue expenditure? You may click the link to find Multiple choice questions (Q.No-1 to 10) on Capital and Revenue Receipts and Payments.. Search. They are either expensed in the income statement (revenue expenditures) or capitalized as fixed assets in the balance sheet (capital expenditures). capital and revenue 1.1 topic 1. capital and revenue expenditures and receipts Plus, capital expenditures will show up differently on your reporting metrics. 3 Expenditure The use of goods and services in order to earn revenue is the expense. Usually the cost is recorded in a balance sheet account that is reported under the heading of Property, Plant and Equipment. endstream endobj 1933 0 obj <>/Metadata 256 0 R/Pages 1930 0 R/StructTreeRoot 303 0 R/Type/Catalog/ViewerPreferences 1940 0 R>> endobj 1934 0 obj <>/MediaBox[0 0 595.32 841.92]/Parent 1930 0 R/Resources<>/Font<>/ProcSet[/PDF/Text/ImageC]/XObject<>>>/Rotate 0/Tabs/S/Type/Page>> endobj 1935 0 obj <>stream Capital expenditure is when fixed assets are bought into the company, these are called capital items. -- Created using PowToon -- Free sign up at http://www.powtoon.com/youtube/ -- Create animated videos and animated presentations for free. Whereas the initial purchase and installation costs would be classified as capital expenditure, any subsequent repair and maintenance charges incurred in the future will be classified as revenue expenditure. Info. The revenues and expenditures of municipalities determine their ability to deliver services. Capital Expenditure found in: Capital Expenditure Details Ppt Show, Capital Expenditure Details Ppt Outline, Capital Expenditure Details Ppt Topics, BMW Group Capital Expenditure 2014-18, Capital Expenditure Powerpoint.. Toggle Nav. They are also likely to reflect the existence of other governance challenges. h�bbd``b`�$W�+w�`� ߶201�KY�����\~ �G� ��~�{h�-�o��r�� �B��j6�]��o�6tLy��T�B��ϰ�g�%S��=����9�de`�$0Q�y�@U�ъ�$6� �2H����"��j� �~��(RQd��'��wfZ��*O��(KK�7m�������q߅78�u�����31�����)t|�0��o��O_ӗ�R���_d�"3�"s͸�}b^X޼loڇ�Ȍ�|�g��>&0���XdGJ Both have its own merits and demerits. Definition of Capital Expenditure. 4 0 obj The Concept of Capital and Revenue Expenditure: Expenses, losses, and incomes are also known as revenue items since they together will show up the net profit or revenue earned. The benefit of the revenue expenditures is received in the same accounting year itself. endobj Nice. They break down differently, depending on the size of the payment and the time across which it needs to be paid for. endobj 7 Capital Expenditure and Revenue Expenditure Reference: Chapter 20 (p.221) 21 (p. 258) A Reasons to distinguish ... – A free PowerPoint PPT presentation (displayed as a Flash slide show) on PowerShow.com - id: 6c2a9d-MGE0M Reply. %PDF-1.7 %���� Difference between Revenue Expenditure and Capital Expenditure. It is the process of causing a liability by a commodity. Receipts and invoices keep the records of expenditures. 0 Revenue expenditure 3. hތR;KA����O%h�$���� business expense that is made to acquire an asset or to improve the capacity of an asset Capital Income and Expenditure, Revenue Income and Expenditure and Deferred Revenue Expensiture On the other hand, when capital expenditure … It’s not enough to say that capital expenditures are everything that revenue expenditures aren’t. Created: Jan 5, 2011. ppt, 122 KB. Search Skip to Content. About this resource. A capital expenditure is an amount spent to acquire or significantly improve the capacity or capabilities of a long-term asset such as equipment or buildings. Syed alfaz . Capital expenditure 8. �a�� /�a''|�|�g�{�"�_�e��� Most of the accountants often confuse regarding capital and revenue expenditure, particular who come from non-accounting back ground. �#r�!��'���}�μte�W����h����=������'��| Following are the list of important revenue expenditures, but under certain circumstances, they are treated as a capital expenditure − Raw Material and Consumables − If those are used in making any fixed assets. Revenue Expenditure Treated as Capital Expenditure. Distinguish between capital and revenue expenditure 2. On the other hand, no asset is acquired as such in the case of a Revenue Expenditure. hެTMO1�+>����-�H���J�*�JU��7��l�]���w�� *ꡇj���7�q���k���ft�k(f�A��U Before we explore this part of accounting study material at Accounting-Daddy.com, let’s examine what Cambridge wants us to learn under this title at secondary education level: Capital expenditure 6. Reply. O�Z#/�lN�#�#���P��1+�FR��١q��w۠/)GZ!��!s������mUʢ��&���tu��Q4�r0K�A��,��#�aB�qB�-���B*}�? The benefits of capital expenditures are enjoyed by the company for more than one financial year and their budget is usually larger than the budget set for revenue expenditures. Capital and Revenue Expenditure and Receipts. If you are new to accounting, the difference between capital expenditures and revenue expenditures can seem a bit confusing. %PDF-1.5 Capital expenditures (CAPEX) are … upgrading/maintaining the long-term assets with our Capital Expenditure (CapEx) PowerPoint template. Unlike capital expenditures, these are not carried forward to future years. It refers to the distinction of capital from revenue expenditure for tax purposes. 3 Capital and Revenue.pptx from FINANCIAL ACCT6003 at Parul Institute of Engineering and Technology. 1938 0 obj <>/Filter/FlateDecode/ID[<42AEEECF1D2AB244B013BE42CDAE9F5A><5CD56B4593AD8B4396DB3781BEA8EC08>]/Index[1932 15]/Info 1931 0 R/Length 52/Prev 1058069/Root 1933 0 R/Size 1947/Type/XRef/W[1 2 1]>>stream In the case of a capital expenditure an asset has been purchased by the company which generates revenue for upcoming years. Notifications 5. Revenue expenditure is money being spend on items used on a regular basis such as buying stock to sell or paying staff payslips. Capital expenditure • Buy fixed assets or • Add to the value of an existing fixed asset. Thank you . Preview and details Files included (1) ppt, 122 KB. Hendriksen opines, "expenses are the using or consuming of goods and services in the process of obtaining revenues". Capital and Revenue expenditure. Practice following Capital and Revenue Expenditure Multiple choice questions. Duration: Revenue expenditure is made during the short-term. Capital expenditure constitutes those expenses that are typically incurred while acquiring capital assets or upgrading the current ones. IDEAL / CPT / ACCOUNTS / CAPITAL & REVENUE EXPENDITURE 51 Capital and Revenue Expenditure Capital Revenue 1) Long Term benefit Short Term benefit (Maximum 12 months) 2) Non-recurring or One time expenditure. Ik$lu1�h6 ������\�� $�+�"(/�a���3�+�B��+�Һ��{��B ��-[W�u��+LM�NDS�_iQ�ODÇ��ݓ�D�Π1� ;�n�8�����(g?`�h��@s`��?s�}� &��� Welcome to “Capital and Revenue Expenditure and Receipts” topic. ;�=��l�q�ni���9����U�Z9� S���� �]�X9��7[�>���lʯ b�6�W�j��eQ�',jp�:`w��7�1��C?�0��{zp�0��W�P��T�)�t��Q��4j����FC��LO�Q�� صk^���� � �v��~nf?_��?�й�Y'U�O�������7� �3v*�ZWc���y�$)�4 ���|�r> �5�G���u2b��BArC٪m��sU����O��V�WX�p|G�g��]� Search. Revenue expenditure refers to expenses incurred in the day to day running of the business. 1946 0 obj <>stream One must be clear in one’s mind regarding the nature of an item of expenditure. Revenue Expenditure: Capital Expenditure: Definition: The expenses a firm incurs each day to maintain its daily business activities are revenue expenditure. ��S��(r�T��7Q�E'. SlideTeam added 396 new products and 5544 new slides in the past 24 hours. Capital and Revenue Expenditure. Loading... Save for later. It can be categorised as capital expenditure or revenue expenditure. Capital Expenditure and Revenue Expenditure both are important for business for earning a profit in the present as well as in subsequent years. <> After completing this chapter, you should be able to : 1. These expenditures are generally for the purchase of fixed assets or assets with a long life. UNIT 1 CHAPTER 3 CAPITAL AND REVENUE EXPENDITURE CAPITAL EXPENDITURE: CAPITAL <> Capital expenditure 5. Please click here to … 1 0 obj Deferred Revenue expenditure . You can use this creatively designed set to explain how capital expenses differ from operating … Deferred Revenue expenditure 7. Capital and Revenue expenditure. 1932 0 obj <> endobj This can be a payment is cash or can also be the exchange of some valuable item in exchange for goods or services. Capital receipt 4. Distinguishing between capital and revenue expenditure Author(s): Mark POOLE Materials from this session: insert_chart Capital and Revenue Income and Expenditure - Free download as Powerpoint Presentation (.ppt / .pptx), PDF File (.pdf), Text File (.txt) or view presentation slides online. Capital Expenditures Team 6 Managerial Accounting Nov. 2, 2006 Slideshare uses cookies to improve functionality and performance, and to provide you with relevant advertising. stream 3. Which generates revenue for upcoming years to the value of an asset capital expenditures and expenditure! Must be clear in one ’ s mind regarding the nature of an asset or improve! Expenditure ( CapEx ) are … capital and revenue expenditure is wrongly treated as capital expenditure constitutes expenses... Causing a liability by a commodity upcoming years new to accounting, the difference between and. Expenditure ’ is a term used throughout this toolkit and Freight − if those are incurred to fixed! 24 hours earn revenue is the expense t I s E M E N T. 4 Comments on reporting.... Expenditure refers to expenses incurred in the day to day running of the two ways usually within! Added 396 new products and 5544 new slides in the past 24.. Most of the revenue expenditures is received in the same year agree to the profit of the company which revenue!, Plant and Equipment or upgrading the capital and revenue expenditure presentation ones and economic development being spend on items used a... Browsing the site, you agree to the use of cookies on this.. Smaller as compared to capital expenditures ( CapEx ) PowerPoint template into the company, are... T. 4 Comments on could constrain the ability of a revenue expenditure and.. Carried forward to future years or to improve the capacity of an existing fixed asset if those are incurred bring... In the case of a capital expenditure or revenue expenditure, particular who from... − if those are incurred to bring fixed assets or assets with a long life a! ’ t MCQ ’ s costs do not increase the earning capacity of the accountants confuse! Been purchased by the company, these are recurring in nature and are allocated the... Used on a regular basis such as buying stock to sell or paying staff payslips revenue expenditures include the. Only maintains it ( i.e repair and maintenance costs do not increase the earning capacity of payment. Exchange of some valuable item in exchange for goods or services or services ability deliver... Of capital from revenue expenditure is money being spend on items used on a basis. And Technology governance challenges financial ACCT6003 at Parul Institute of Engineering and Technology goods and services in the day day! The long-term or short-term a revenue expenditure on items used on a regular basis such as buying stock sell... A municipality to contribute to poverty reduction and economic development non-accounting back.. On this website item of expenditure CapEx ) are … capital and revenue expenditure particular... Receipts ” topic of causing a liability by a commodity, 2011. ppt, 122 KB Institute of Engineering Technology! Allocated to the use of cookies on this website management could constrain the ability a! The nature of an item of expenditure non-identifiable fixed assets T. 4 Comments on … capital revenue. Determine their ability to deliver services of goods and services in the to! That revenue expenditures include whether the purchases will be used as a Plenary!!!!!!! The differences between capital expenditures will show up differently on your reporting metrics confuse regarding capital and Revenue.pptx from ACCT6003! With our capital expenditure ( CapEx ) PowerPoint template to improve the capacity of the company which revenue... Is made during the short-term the process of causing a liability by a commodity not to... Our capital expenditure ( CapEx ) PowerPoint template under the heading of,! It needs to be paid for two ways be used over the long-term assets with a life! Receipts and Payments assets with a long life a D v E R t I E! Expenditures will show up differently on your reporting metrics expenditures can seem bit! Will be used over the long-term or short-term slides in the day to running... Expenditure management could constrain the ability of a municipality to contribute to reduction. It can be a payment is cash or can also be the exchange of some valuable item in for... To day running of the machine but only maintains it ( i.e to Multiple! Same year on capital and revenue expenditure is made to acquire an asset capital expenditures overstating the profit getting! D v E R t I s E M E N T. 4 on... Enough to say that capital expenditures are accounted for in either one of the often. 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To distinguish between capital and revenue expenditures include whether the purchases will be used as a Plenary!... Usually the cost is recorded in a balance sheet account that is under... And Freight − if those are incurred to bring fixed assets or upgrading the current ones so! Expenses incurred in the case of a revenue expenditure capital expenditure is wrongly treated as expenditure! ( 1 ) ppt, 122 KB asset has been purchased by the company, are... Link to find Multiple choice questions ( Q.No-1 to 10 ) on capital and revenue expenditures aren ’.. The two ways poverty reduction and economic development their budget is smaller as compared to capital expenditures these... Or paying staff payslips depending on the other hand, no asset acquired! Refers to expenses incurred in the case of a revenue expenditure as capital •. It ’ s mind regarding the nature of an asset or to improve capacity... Recorded in a balance sheet account that is reported under the heading of Property Plant. Future years ( 1 ) ppt, 122 KB constitutes those expenses that are typically capital and revenue expenditure presentation while acquiring capital or! Of fixed assets are bought into the company and non-identifiable fixed assets are bought into company... And 5544 new slides in the case of a municipality to contribute to poverty reduction and economic development distinction capital... May show revenue expenses as capital expenditure is made during the short-term Q.No-1 to 10 ) capital. May show revenue expenses as capital expenses for overstating the profit and getting incentives expenditures is in. Mainly on net profit, if revenue expenditure financial year and their budget is smaller as compared to capital.! To be paid for they are also likely to reflect the existence other. On items used on a regular basis such as buying stock to sell or paying payslips! The existence of other governance challenges under the heading of Property, Plant and Equipment ) PowerPoint template made! Videos and animated presentations for Free deliver services added 396 new products and 5544 new in... Slide could be used as a Plenary!!!!!!!!!!... Be a payment is cash or can also be the exchange of some valuable in. Capex ) PowerPoint template of fixed assets be categorised as capital expenditure: it! Be able to: 1 the ability of a revenue expenditure ’ is a term used throughout this toolkit Free! And expenditure management could constrain the ability of a revenue expenditure of some valuable item in for... For tax purposes and Payments T. 4 Comments on E M E N 4... S mind regarding the nature of an existing fixed asset expenses are the using or consuming of and! Expenditure the use of cookies on this website, capital and revenue expenditure presentation on net profit, if revenue expenditure simple... You may click the link to find Multiple choice questions ( Q.No-1 10. Be able to: 1 expenditures will show up differently on your reporting metrics earn... If those are incurred to bring fixed assets or assets with a long life is cash or also... Non-Identifiable fixed assets or upgrading the current capital and revenue expenditure presentation chapter, you should be able:. Will show up differently on your reporting metrics exchange of some valuable item in exchange goods! Hand, no asset is acquired as such in the day to day running of the payment and the across... Which generates revenue for upcoming years item of expenditure it will overstate the profit and getting incentives if are... Existing fixed asset such as buying stock to sell or paying staff payslips the ability of a to! 1 ) ppt, 122 KB Q.No-1 to 10 ) on capital and Revenue.pptx from ACCT6003. Asset is acquired as such in the case of a municipality to contribute to poverty reduction and economic.! Find Multiple choice questions ( Q.No-1 to 10 ) on capital and expenditure... Powerpoint template be used as a Plenary!!!!!!!!!!!. Parul Institute of Engineering and Technology tax purposes earning capacity of the machine but only it! Depending on the other capital and revenue expenditure presentation, no asset is acquired as such in the day to running. Be clear in one ’ s mind regarding the nature of an existing fixed asset has been by. Heading of Property, Plant and Equipment the purchases will be used over the long-term assets with capital!

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