DK Goel Solutions Chapter 20 Capital and Revenue

DK Goel Accountancy Class 11 Solutions Chapter 20 Capital and Revenue which is outlined by expert Accountancy teachers from the latest version of DK Goel Class 11 Accountancy books. We at BYJU’S provide DK Goel Solutions to assist students to comprehend all the theories in particular. There are numerous concepts in Accountancy, but the concepts of Trial Balance, Depreciation and Bank Reconciliation Statement (BRS) are required.

DK Goel Accountancy Class 11 Solutions – Chapter 20

Question 1

What is Capital Expenditure?

Answer: Any expenditure which is incurred in obtaining or increasing the value of a fixed asset is known as capital expenditure. Similarly, the total amount spent on the Plant and Machinery, Land and Building, Furniture and fixtures etc., Such expenditure yields benefit over a long period.

Question 2

What is Revenue Expenditure?

Answer: Any expenditure, the benefit of which is received during the current year itself is termed as revenue expenditure. Similarly, all the revenue expenditures are debited to the Trading and Profit and Loss a/c.

Question 3

State the differences between Capital Expenditure and Revenue Expenditure.

Answer:

Capital Expenditure

Revenue Expenditure

Any expenditure which is incurred in obtaining or increasing the value of a fixed asset is known as capital expenditure.

Any expenditure, the benefit of which is received during the current year itself is termed as revenue expenditure.

The total amount spent on the Plant and Machinery, Land and Building, Furniture and fixtures etc.,

All the revenue expenditures are debited to the Trading and Profit and Loss a/c.

Capital expenditure is incurred for the purpose of increasing the capacity of the trading concern.

Revenue expenditure is incurred for the purpose of maintenance of earning capacity.

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