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Class : 11
Unit : Account


State any three differences between capital expenditure and revenue expenditure.

Ans : The following are the difference between capital expenditure and revenue expenditure. Basses of Difference Capital expenditure Revenue expenditure Effect Its effect is long-term. The benefits is received for a number of years in future. Its effect is temporary. The benefit is received within the accounting year. Physical existence It has physical existence except intangible assets. It has no physical existence. Frequency It is non-recurring and irregular. It is recurring and regular as it occurs repeatedly. Treatment A portion of this expenditure is shown in income statement. The whole amount of this expenditure is shown in income statement.
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