Capital Expenditure (CAPEX)

Knowledge Center




Summary, forum, best practices, expert tips and information sources.

13 items • 25.265 visits

Translate


Summary

What is Capital Expenditure (CAPEX)? Meaning.

Capital Expenditure is a payment (investment) that creates future benefits. It is incurred when a company spends money to acquire or upgrade physical, fixed assets such as equipment, property, industrial buildings with a useful life extending beyond the taxable year. In some cases also in intangible assets.


In accounting, a capital expenditure is added to an asset account (i.e. capitalized), thus increasing the asset's basis (the value or cost of the asset adjusted for tax purposes) in the event of sale or transfer.

 

For tax purposes, depending on the country, CAPEX is typically a cost which cannot be deducted in the year in which it is paid or incurred. It must be capitalized: the general rule is that if the acquired property's useful life is longer than the taxable year, then the cost must be capitalized.

The capital expenditure costs are then amortized or depreciated over the life of the particular asset.


Included in capital expenditures are amounts spent on:

  • Acquisition of fixed, and in some cases, intangible assets
  • Repair of an existing asset so as to improve its useful life
  • Upgrade of an existing asset if its results in a superior fixture
  • Preparation of an asset to be used in business
  • Restoring a property or adapting it to a new or different use
  • Start or acquisition of a new business

Special Interest Group

Capital Expenditure Special Interest Group.



Special Interest Group (51 members)

Forum

Forum about Capital Expenditure. Below you can ask a question about this topic, share your experiences, report a new development, or explain something.


Start a new topic about Capital Expenditure

 

🔥 NEW Capital Expenditure Types?
I want to know the actual types of capital expenditure. Thanks for your input!...
3
 
4 comments

Best Practices

The best, top-rated topics about Capital Expenditure. Here you will find the most valuable ideas and practical suggestions.


Expert Tips

Advanced insights about Capital Expenditure. Here you will find professional advices by experts.


Information Sources

Various sources of information regarding Capital Expenditure. Here you will find powerpoints, videos, news, etc. to use in your own lectures and workshops.


Capital Budgeting and Risk Management Techniques

Capital Budgeting, Risk Management
Presentation about advanced capital budgeting, including the following sections: 1. Contents 2. Capital budgeting 3. ...

Research Links

Jump to further research sources regarding Capital Expenditure.


News

News

Videos

Videos

Presentations

Presentations

 
Books

Books

Academic

Academic

More

More


Compare: Return on Investment

Special Interest Group

Do you know a lot about Capital Expenditure? Become our SIG Leader

 

Return to Management Hub: Decision-making & Valuation  |  Finance & Investing


More on Management  |  Return to Management Dictionary

 

This ends our Capital Expenditure summary and forum.



About 12manage | Advertising | Link to us / Cite us | Privacy | Suggestions | Terms of Service
2023 12manage - The Executive Fast Track. V16.1 - Last updated: 4-2-2023. All names of their owners.