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What is Capital Expenditure?

Learn accounting with us today ➡️ https://www.theaccountingstudent.co.uk WHAT IS CAPITAL EXPENDITURE? Capital expenditure is recognisable when a business spends money on fixed assets, additions to a fixed asset or to get a fixed asset in a position ready to be used. Additionally, capital expenditure can be identified if the money is also spent on transactions or items such as…purchasing a fixed asset, bringing a fixed asset into the business, legal costs relating to the purchase of the buildings or property, delivery costs on the machinery or motor vehicles bought, any necessary costs to prepare the fixed asset to be in a condition for use and finally interest incurred on the construction of a fixed asset. It is very important to understand that capital expenditure has no relation with the owner’s capital account. Capital relates to the owners and the owners only and capital expenditure relates solely to the business. Also it is vital that there is a correct distinction between capital and revenue expenditure as this is essential to determine a correct value for the profit and assets of a business. This video will help you with questions such as what are examples of capital expenditures, what do you mean by capital expenditure, what is capital expenditure UK, what is the difference between expenditure and capital expenditure, what is capital expenditure in accounting, what is capital expenditure vs capex, what is capital expenditure example, what is capital expenditure and revenue expenditure, which of the following is a capital expenditure, types of capital expenditure, capital expenditure budget. MUSIC CREDIT ‪@benfrydrums‬ DISCLAIMER Our content is to be used as an EDUCATIONAL TOOL that aims to provide a foundation for individuals to learn financial accounting, management accounting and bookkeeping topics as practiced in the United Kingdom. As a result, not all complexities are shown or provided. Examples may include but are not limited to; differences between financial reporting, accounting standards or tax treatments. We are NOT ENGAGED in the providing of accounting, bookkeeping, financial, investment, tax, or other professional services. You should consult with a qualified or professional such as an accountant, business advisor, investment specialist, lawyer, solicitor, etc., with regards to specific facts and situations. #whatiscapitalexpenditure #capitalexpenditure #capitalexpense