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WAEC Financial Accounting 1999 Question 24

Question 24

Capital and Revenue Expenditure

Which of the following is not a revenue expenditure?

  1. A.Repair of generating set
  2. B.Purchase of inventory
  3. C.Extension of building
  4. D.Payment of subscription.
Show the answer and explanation

Answer: C (Extension of building)

Explanation

Extending a building adds to a fixed asset, so it is capital expenditure.