Dear Shweta,
Let's understand few concept before analysing about the type of expenditure..
Business transaction is of 2 types:
Apart from this there is Deffered Revenue Expenditure.
Since you are asking about the expenditure so i am writing here only about Expenditure..
Capital Expenditure:
Those expenditure which gives benefit for more than one year. For e.g.,
- Fixed asset purchased,
- Any expenditure on fixed asset which increases PROFIT either by way of Efficiency increase or Reduced cost of operation or both.
Revenue Expenditure:
Those expenditure which gives benefit for one accounting year only. For e.g., Compensation paid to employees.
Deffered Revenue Expenditure:
Those expenditure which gives benefit for more than one year AND expenditure not incurred on Fixed Asset.
Whether a particular expense is CAPITAL or not, in order to find the answer of this question check following conditions ...
- Exp. must give benefits for more than ONE year AND
- Exp. must be on FIXED ASSET
- Exp. must increase the PROFIT
- Expenditure must increse the value of ASSET.
If above conditions is satisfied then it is capital in nature.
ANSWER TO YOUR QUERY
- Capital Expenditure
- Capital Exp.
- Revenue Expenditure
- Deffered revenue Exp.
- Capital exp. ( It is a Capital loss)
For reason please read the whole article. I hope this will help you in order to understand the above mentioned topic....