Which of the following is not a capital expenditure?
A)Advertising expenditures to introduce a new product line
B)Sales tax paid in conjunction with the purchase of new machinery
C)Installation of elevators to replace escalators
D)An amount paid to acquire a patent with a remaining life of only three years

Question

Quizplus · Accepted Answer

Advertising expenditures are generally considered as operating expenses, as they are incurred to maintain ongoing business operations, rather than being related to the acquisition of long-term assets. B, C, and D are all examples of capital expenditures, as they are related to the acquisition, improvement, or replacement of long-term assets that will provide future economic benefits to the company.

Which of the Following Is Not a Capital Expenditure