Accounting terms Q5

Q.
a) Differentiate between:

1. Capital expenditure and revenue expenditure.
2. Fixed assets and current assets.

(10 marks, 2011 5a)

b) Indicate which of the following would be revenue items and which would be capital items.

1. The purchase of machinery for use in the business.
2. Complete redecoration of the premises at a cost of RM1,500.
3. The cost of installing a new machine.
4. A motor vehicle bought for resale by a motor dealer.
5. Cost of building extension to factory.

(10 marks, 2011 Q5b)