A $600,000 outlay for a new machine that utilizes the latest robotics technology, and with a...
A $600,000 outlay for a new machine that utilizes the latest robotics technology, and with a usable life of 10 years, is called a;
A) capital expenditure.
B) operating expenditure.
C) replacement expenditure.
D) investment expenditure.
Homework Answers
Option 'A' is correct
Capital Expenditure is the answer
$600,000 outlay purchasing a machine that utilizes the latest robotics technology is a capital expenditure in the hands of the company. The cost of the Machine is depreciated over usable life of the Machine.
Capital expenditure is the money spent by a business or organization on acquiring on maintaining fixed assets, such as Equipment, Land etc.
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