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WAEC Financial Accounting 2005 Question 20

Question 20

Capital and Revenue Expenditure

Capital expenditure is the

  1. A.cost of running a business
  2. B.money spent on buying goods for resale
  3. C.money spent on acquiring fixed assets
  4. D.extra capital paid in by the proprietor.
Show the answer and explanation

Answer: C (money spent on acquiring fixed assets)

Explanation

Capital expenditure buys or improves fixed assets.