Which of the Following Would Not Be Considered a Capital

question 202

Multiple Choice

Which of the following would not be considered a capital expenditure?

• A)The addition of a building wing
• B)A tune-up of a company vehicle
• C)A complete overhaul of an air-conditioning system
• D)The cost of installing a piece of equipment

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Definitions:

AASB 10/IFRS 10

An Australian/international financial reporting standard that establishes principles for the presentation and preparation of consolidated financial statements when an entity controls one or more other entities.

Consolidated Financial Statements

Financial statements that show the financial position and results of operations for a parent company and its subsidiaries as one economic entity.

Elements of Control

Factors or conditions that grant an entity the power to govern the financial and operating policies of another entity, typically to benefit from its activities.

Relevant Activities

Activities that significantly affect the returns of an investment or project under consideration.