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    Question

    Capital expenditure results

    in:
    A Increase in revenue Correct Answer Incorrect Answer
    B Increase in liability Correct Answer Incorrect Answer
    C Acquisition of a fixed asset Correct Answer Incorrect Answer
    D Reduction in owner's equity Correct Answer Incorrect Answer

    Solution

    Capital expenditure is incurred to acquire, improve, or extend the life of a fixed asset (tangible or intangible) that will provide benefits over more than one accounting period.

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