Which of the following would be considered a capital expenditure?
A) A truck tune-up
B) Machine maintenance
C) Installation of a solar heating system
D) Painting a room

Question

Quizplus · Accepted Answer

Capital expenditures are investments made in fixed assets that provide long-term benefits to a company. The installation of a solar heating system fits this definition, as it will likely provide energy cost savings for several years into the future. A truck tune-up, machine maintenance, and painting a room are all examples of routine, ongoing expenses that do not involve the acquisition or improvement of a fixed asset.

Which of the Following Would Be Considered a Capital Expenditure