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      Question

      Which of the following is an example of capital

      expenditure?
      A Routine maintenance cost of machine Correct Answer Incorrect Answer
      B Purchase of new factory building Correct Answer Incorrect Answer
      C Salaries of production staff Correct Answer Incorrect Answer
      D Repairs and renewals Correct Answer Incorrect Answer
      E Advertising expense Correct Answer Incorrect Answer

      Solution

      Capital expenditure creates future economic benefit and is capitalised.

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