Q180
The purchase price of a software that will be used for more than 12 months should be regarded as
A.
a revenue expenditure
B.
a capital expenditure
AnswerC.
a long term expense
D.
an accounting period expense
Answer: Option B
Solution
Answer: Option B
Solution:
The purchase price of a software that will be used for more than 12 months should be regarded as a capital expenditure. It is considered a capital expenditure when the asset is newly purchased or when money is used towards extending the useful life of an existing asset.