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Capital and Revenue Expenditure

Accountancy

1.Inauguration expenses incurred on opening a new business for the first time is Capital expenditure? 2.Inauguration expenditure incurred on opening a new unit of an existing business is revenue expenditure?

Nidhi S

CA Inter

★ 4K+

07-Dec-23 22:30

613

Answers (9)

Both revenue

CA Suraj Lakhotia

Admin

07-Dec-23 23:10

How come both are revenue expenditure,I think both are capital expenditures

Pradeep Kumar

CA Inter

★ 500

07-Dec-23 23:48

Pls clear my doubt

Pradeep Kumar

CA Inter

★ 500

07-Dec-23 23:49

There shd be future economic benefit then only we can book it as capital expenditure and recognise asset,

R Yashwanth Kumar

CA Final

★ 87K+

08-Dec-23 08:03

Case 1 Yes Inauguration expenses incurred on opening a new business for the 1st time are generally considered ***capital expenditure*** In case 2 Inauguration expenditure incurred on opening a new unit of an existing business can be treated as ***either capital or revenue exp*** depending on the nature of the expenses and accountong policies of the co's

Balachandar S

CA Inter

★ 59K+

08-Dec-23 09:22

Inauguration expenses are never capital expenditure

CA Suraj Lakhotia

Admin

08-Dec-23 09:24

CA Suraj Lakhotia Admin

Inauguration expenses are never capital expenditure

Sir but how Can you explain pls

Balachandar S

CA Inter

★ 59K+

08-Dec-23 09:26

Balachandar S

Sir but how Can you explain pls

It does not increase the benefit that you will derive from the asset.

CA Suraj Lakhotia

Admin

11-Dec-23 14:02

CA Suraj Lakhotia Admin

It does not increase the benefit that you will derive from the asset.

👍

Balachandar S

CA Inter

★ 59K+

11-Dec-23 15:34