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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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