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Unit 5 Accounting - P2

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Capital Expenditure Revenue Expenditure Capital Income
Capital Expenditure Revenue Expenditure Revenue Income Capital Income
Capital expenditure is where Revenue expenditure is simply Capital income is the
Machinery Credit purchase. This is buying for a Rent received New partner
businesses spend a large amountsupplier. the money on the day to day money bought into the
of moneyLorry
on fixed assets, these Mortgage things of running
introns. This is the a business,
cost of Cash sales business which isn’t
Loans
can be both tangible and the often you physically see nothing
property but with no physical generated by the
asset.
intangible. Tangible assets are Petrol for it. A revenue expenditure
Office Equipment
is an business activities.
Credit sales. This is the
For
Share issues
capital expenditure that you can amount that is charged straight customers that example
have loans from the
physically see, for example fixtures away and being matched purchased on bank, credit. shareholders and
Goodwill
and fittings, machinery, vans and Pensions
with revenues. Revenue Commission mortgage. If youMoneyarefrom friends. Sole
trader or partnership
the actual property itself. Whereas expenditure is the most popular sole trader orbusiness
in a may get this, will
intangible assets are types of type of expenditure with their partnership then it is
either be as a loan or a
capital expenditure you can’t being a lot of things that the classed as owners
share.
Fixtures and Fittings Marketing Savings
physically touch. Intangible assets business pays for on day to day capital. However but if
Computer
add to a business’s possible futurePrinting
basis that a lot of people in Interest
the receivedyou are a public/private
worth andLease
canpayments.
be muchThismoreis a Postagebusiness don’t notice. For Sales of services limited company then it
long term lease.
valuable than its tangible assets. example the petrol for the vans, is referred to as share
Trademarks Telephone charges
For example having a patent, stationary and the insurance they capital, because they
Purchase of land Vehicle tax
trademark and goodwill. A patent is have to pay. have shares in the
Buildings
the legal protection of something Wages and salaries business. Businesses
Mortgage repayments.
that the business This
have invented. Raw
A materials prefer loans compared
Is the cost of the building
business with
maynopaten their idea to
interest.
to shares because with
prevent other
Patentsbusinesses from Stationary loans the business have
copying and using the idea also. Heat and light more control and less
Trademark is a symbol, logo, brand shareholders to pay
Insurance
name, words or even colour that whereas if they got
Bank charges
makes a business’s predicts more money from
different to competitors products. shareholders then it
So they have a key influence on would result in them
the customer’s choice because losing control, so that is

, Loan repayment
Cash purchases
Rates
Carriage of sales. This is the cost of
the delivery to the destination.




Revenue income
Revenue income is just basically anything it sells, so it is anyway they
generate money through trading. So it is just the way the business mainly
earns it money. For example the rent they have received, their cash sales,
credit sales so customers who have purchased on credit. Their commission
is an example, their savings, interest received or their sales of services.
Trading income is the income that the business generates from its ales
when it is trading with customers or other businesses. Non trading income
is the money bought into the business that is from outside the business, so
things like rent and dividends from investments. So the money that is
bought in but not from core activities of the business.




The difference between revenue income and capital income is that the revenue income is
the money made by the day to day functions, so the sales of goods and commission
received. Whereas the capital income is the money. Capital income is the money bought
into the business which isn’t generated by the business activities. For example loans from

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Uploaded on
February 12, 2016
Number of pages
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Written in
2014/2015
Type
Essay
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