With reference to the expenditure made by an organization or a company, which of the following statements is/a

Question

With reference to the expenditure made by an organization or a company, which of the following statements is/are correct ?
1. Acquiring new technology is capital expenditure.
2. Debt financing is considered capital expenditure, while equity financing is considered revenue expenditure.
Select the correct answer using the code given below :

Accepted Answer

Capital expenditure refers to funds used by a company to acquire, upgrade, and maintain physical assets such as property, buildings, technology, or equipment. Acquiring new technology that provides long-term benefits falls under this category. Debt financing and equity financing are methods of raising funds, not expenditures themselves. While the *use* of these funds can be classified as capital or revenue expenditure, the financing method itself is not the expenditure type.