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Hello Sir,
Is the following expense a revenue or capital expenditure
redecoration expenses to make shop more attractive
in the answer it is NOT added back to profitWhy is that so?
Sir I too am a little confused. As per the study text it’s revenue expenditure, but I was just wondering that redecoration should in reality enhance the look of the shop(beyond maintenance), thus allowing the owner to augment his income. That way, it becomes an improvement/cap ex, which is disallowed.
So, could you just shed some light on this area.
Hey jean. The thing is am more of a solitary learner, so I don’t think I’ll be able to join the group you sent me a link of. Thanks for the offer tho.
Good luck for your F6.Decoration costs are a normal maintenance cost incurred and therefore a revenue cost as you have seen in the notes and I have stated in the lecture – that is the rule – once again until you become chancellor of the exchequer and can make the rules, what you think “should” be the rule is not the issue – learn the rules that exist and do not waste your time arguing that they should be different
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