Which of the following statements regarding the capital expenditures budget is correct?
A) Installment payments related to the purchase of long-term assets are included in the capital expenditures budget.
B) Capital expenditures are purchases of long-term assets, such as office supplies.
C) The decision to purchase long-term assets is part of a strategic plan.
D) Capital expenditures are inexpensive assets.

Question

Quizplus · Accepted Answer

The capital expenditures budget involves the purchase of long-term assets, such as property, plant, and equipment, which are necessary for the operation of the business. These purchases typically require a significant investment of capital and are part of a company's strategic plan for growth and expansion. Installment payments related to the purchase of long-term assets would be included in the cash budget, not the capital expenditures budget. Office supplies are considered inventory or operating expenses, not long-term assets. Capital expenditures are generally expensive assets, not inexpensive ones.

Which of the Following Statements Regarding the Capital Expenditures Budget