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WAEC Financial Accounting 2000 Question 2

Question 2

Capital and Revenue Expenditure

Which of the following is a capital expenditure?

  1. A.Salaries and wages
  2. B.Stationery
  3. C.Repairs of motor vehicle
  4. D.Purchase of furniture.
Show the answer and explanation

Answer: D (Purchase of furniture.)

Explanation

Buying furniture gives a long-lasting asset, so it is capital expenditure.