Banking Term: Capital Expenditure

Find important banking term that is useful in upcoming banking exam.

Created On: Jun 4, 2015 14:30 IST

Banking Term: Capital Expenditure

  • Capital expenditure is a purchase of fixed assets (eg. Plant and equipment), expenditure on Trade Investment or acquisitions of other businesses and expenditure on current assets (eg. Stock).
  • It differs from capital formation
  • It is an amount spent to acquire or improve a long-term asset such as equipment or buildings.
  • The cost (except for the cost of land) will then be charged to depreciation expense over the useful life of the asset.

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