In order for a cost to be capitalized (capital expenditure), the following must be present:

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Capital expenditures are costs that are capitalized, meaning they are added to the capital value of the asset rather than being expensed immediately. This can happen when the expenditure increases the useful life of an asset, increases the quantity of assets, or improves the quality of assets. Therefore, any of these conditions being met can justify capitalizing a cost.

In Order for a Cost to Be Capitalized (Capital Expenditure)