Expenditures That Add to the Utility of Fixed Assets for More

question 51

Multiple Choice

Expenditures that add to the utility of fixed assets for more than one accounting period are called:

• A)committed expenditures.
• B)revenue expenditures.
• C)current expenditures.
• D)capital expenditures.

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Definitions:

Depreciation

An accounting method used to allocate the cost of a tangible asset over its useful life.

Net Capital Spending

The total expenditure on physical assets less any asset sales, reflecting how much a company is investing in its physical assets.

CCA Rate

The annual depreciation rate used under the Canadian tax system to calculate depreciation expense for tax purposes on a depreciable asset.

CCA

An acronym that can stand for Capital Cost Allowance, which is a tax deduction for depreciable property in Canada.