Revenue vs capital expenditure

Accountancy

The horn served us for 2 years. Now if we replace it, if its serves us for 2-3 years, then would that not be a capital expenditure? If not, why would you consider it as a revenue expenditure instead? Video Details ------------- Accounting - CA Foundation (New) Capital And Revenue Expenditures and Receipts #1. Introduction to Capital Vs. Revenue Expenditure

Devika Venu

CA Foundation

★ 5

12-Nov-25 19:09

226

Answers (1)

The question is does the replacement of horn increase the performance of bike? If it does not we cannot capitalise since no new benefits are being obtained.

CA Suraj Lakhotia

Admin

14-Nov-25 16:45