PRC-1 · Chapter 10 · Question 25 of 100
Which of the following represents a 'Capital Expenditure'?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Purchasing a delivery van for business operations.
Explanation
Capital expenditure involves acquiring or upgrading non-current assets that will provide economic benefit for more than one accounting period, such as a delivery van.
More Preparation of Financial Statements MCQs
- Q27How are 'Return Inwards' (Sales Returns) treated in the Statement of Comprehensive Income?
- Q28How are 'Return Outwards' (Purchase Returns) treated in the calculation of Cost of Sales?
- Q29Which accounting principle dictates that a provision must be made for doubtful debts?
- Q30A business recovers a bad debt of Rs. 5,000 that was written off in the previous accounting year. How is this recovery reported in the…
- Q31In a partnership, where is the 'Interest on Partner's Capital' recorded before creating the final Statement of Financial Position?