Use the question to answer this questionThe following information were extracted from the books of Miliki state Sinking of bore holes Purchase of Motor car ...
Use the question to answer this questionThe following information were extracted from the books of Miliki state
Sinking of bore holes
Purchase of Motor car
Stationery
Electricity
Purchase of drugs
Purchase of beds
₦
2,900,000
920,000
300,000
45,000
76,000
425,000
Capital expenditure is
Answer Details
Capital expenditures are expenditures made by a company to acquire or improve long-term assets that are expected to provide benefits over several years. Examples of capital expenditures include the purchase of equipment, machinery, property, or buildings.
Based on the information provided in the question, the following expenditures are capital expenditures:
- Sinking of boreholes
- Purchase of a motor car
- Purchase of beds
The total amount spent on these items is ₦2,900,000 + ₦920,000 + ₦425,000 = ₦4,245,000.
Therefore, capital expenditure in this case is ₦4,245,000.
In conclusion, capital expenditures are expenditures made to acquire or improve long-term assets that are expected to provide benefits over several years. Based on the information provided, the capital expenditure in this case is ₦4,245,000.