Capital expenditures

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Capital expenditures

Amount used during a particular period to acquire or improve long-term assets such as property, plant, or equipment.

Capital Expenditure

Payments made in cash or cash equivalents over a period of more than one year. Capital expenditures are used to acquire assets or improve the useful life of existing assets. An example of a capital expenditure is the funding to construct a factory. In accounting, capital expenditures must be capitalized; that is, the expenditure is recognized on a balance sheet gradually over the course of an asset's useful life. Capital expenditures are recorded as liabilities on a balance sheet. They are also called capital outlays. See also: Capital asset.
References in periodicals archive ?
The world's largest retailer's capital expenditures for 2004 accounted for 3.
To subscribe to the newsletter or to receive a copy of Packaging Industry Valuations Considerations: Capital Expenditures, or any of the aforementioned reports, clients and members of the media should contact Doug Lawson at dlawson@pjc.
The IRS argued that the work was a capital expenditure to be amortized over the remaining lease term; the taxpayer contended the repair costs were deductible under Sec.
Of the five requirements set forth by the court, only one was relevant in the instant case: the costs must represent current expenses, not capital expenditures.
Accordingly, global capital expenditure is expected to witness strong growth in 2011 at 15%.
On the other hand, the Tax Court found that FPL's accounting method was to treat certain repairs as capital expenditures on its returns in accordance with its regulatory reporting method.
If the expenditure enables property to be put to a new, different use, the cost is a capital expenditure.
The one-year rule serves as a guide in distinguishing between capital expenditures and deductible expenses, regardless of which accounting method a taxpayer uses.
In Tellier, the Supreme Court said the principal function of "ordinary" in section 162 is to distinguish between currently deductible expenses and nondeductible capital expenditures.
Capital expenditures by the FRS companies for refining and marketing increased 49% from their 2004 level to $21 billion in 2005, mostly as the result of mergers and acquisitions.
263(a)-2 provides examples of capital expenditures and includes, among others, the cost of acquiring property with a useful life beyond the tax year.
The resulting capital expenditures will increase production costs-which cannot be fully passed on to customers and will lead to a decline in future earnings.

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