Answer :
Capital Expenditure: Factory extension, Land purchased, Plant & Machinery purchased, Office equipment, Installation and testing of new generation. Revenue Expenditure: Motor vehicle repair, Electricity bill, Staff salaries, Fuel for motor vehicle, Repainting of office building.
Capital expenditure refers to the money spent on acquiring or maintaining fixed assets, such as land, buildings, and equipment. These expenses are considered investments in the business and are recorded as assets on the balance sheet.
Revenue expenditure refers to the money spent on the day-to-day running of a business, such as rent, utilities, and salaries. These expenses are recorded as expenses on the income statement.
Classification of Alpha’s expenses for the month ending 31 October 2017 as follows:
Capital Expenditure:
Factory extension: 800,000
Land purchased: 450,000
Plant & Machinery purchased: 400,000
Office equipment: 120,000
Revenue Expenditure:
Motor vehicle repair: 60,000
Electricity bill: 40,000
Staff salaries: 150,000
Fuel for motor vehicle: 100,000
Repainting of office building: 20,000
Installation and testing of new generation: 6,500
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