Cost of extension to a factory building is classified as
Answer Details
The cost of extension to a factory building is classified as capital expenditure. Capital expenditure refers to the expenditure incurred by a company for acquiring, improving, or maintaining its fixed assets such as land, building, machinery, etc. The cost of extending a factory building is an expense that results in a long-term benefit to the company, and therefore it is treated as a capital expenditure. Capital expenditure is usually recorded on the balance sheet and depreciated over time.