Classify each of the following transactions into capital or revenue transactions: Legal fees on the acquisition of land.Complete repaint of existing…
CA Foundation · Accounting · RTP · January 2026
Classify each of the following transactions into capital or revenue transactions: Legal fees on the acquisition of land.Complete repaint of existing building.Repainting of a delivery van.Providing drainage for a new piece of water-extraction equipment.Carriage costs on a replacement part for a piece of machinery.
Suggested Answer and Working Notes:
Legal fees on acquisition of land: Capital ExpenditureComplete repaint: Revenue ExpenditureRepainting van: Revenue ExpenditureDrainage for new equipment: Capital ExpenditureCarriage costs on replacement part: Revenue Expenditure
Topics: Capital and Revenue Expenditures and Receipts
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