2020 PHS 3E POA EOY P1 Q4
4 The following were payments made by Marilyn in June when she bought a photocopier for the business:
i) Toner for the copier | $250 |
ii) Delivery charges | $100 |
iii) Installation and technical set-up cost | $200 |
iv) Annual maintenance cost | $120 |
REQUIRED
a. Identify if the above payments (i) to (iv) are capital expenditure or revenue expenditure.
[4]
b. State the effects on the statement of financial performance and statement of financial position if a capital expenditure has been wrongly recognised as a revenue expenditure.
[2]
[TOTAL 6]