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WAEC Financial Accounting 1995 Question 45

Question 45

Capital and Revenue Expenditure

Which of the following is a capital expenditure?

  1. A.Purchase of stock
  2. B.Purchase of motor vehicles for sale
  3. C.Subscriptions paid
  4. D.Extension of building
  5. E.Repairs of generator.
Show the answer and explanation

Answer: D (Extension of building)

Explanation

Extending a building adds to a fixed asset: capital expenditure.