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What is Capital Expenditure:

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A) Expenses incurred for buying long-term assets
B) Office rent paid monthly
C) Salary paid to employees
D) Day-to-day expenses of business

Correct Answer: A) Expenses incurred for buying long-term assets

• Capital Expenditure (CapEx) is explicitly defined as Expenses incurred for buying long-term assets. • Examples of CapEx heavily include purchasing heavy machinery, land, and building Infrastructure. • Ordinary day-to-day business costs like office rent are classified as Operating Expenses (OpEx). • Capital expenditures are capitalized on the balance sheet and structurally depreciated over their Useful life.

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