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Question

Consider of the following statement is/are correct about Capital expenditures (CAPEX)?

I. These are often used to undertake new projects or investments by a company.

II. The purpose of CAPEX is to expand a company's ability to generate revenue and earnings.

III. CAPEX can include the purchase of the Manufacturing equipment.

Which of the above statement is/are correct?

A I only Correct Answer Incorrect Answer
B II only Correct Answer Incorrect Answer
C III only Correct Answer Incorrect Answer
D All are true Correct Answer Incorrect Answer
E All are false Correct Answer Incorrect Answer

Solution

Capital expenditures are often used to undertake new projects or investments by a company. Typically, the purpose of CAPEX is to expand a company's ability to generate revenue and earnings. Capital expenditures can include the purchase of the following: 1. A facility or factory, including an upgrade or expansion 2. Vehicles, such as trucks used for the delivery of products 3. Manufacturing equipment 4. Computers 5. Furniture

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