Multiple Select QuestionSelect all that applyWhich of the following items would be included on the capital expenditures budget? (Check all that apply.)Multiple select question.Inventory purchasesInterest expenseSale of plant assetsPlant asset purchasesSales
Question
Multiple Select QuestionSelect all that applyWhich of the following items would be included on the capital expenditures budget? (Check all that apply.)Multiple select question.Inventory purchasesInterest expenseSale of plant assetsPlant asset purchasesSales
Solution
The items that would be included on the capital expenditures budget from the options provided are:
- Inventory purchases
- Plant asset purchases
These are considered capital expenditures because they are large investments in goods which will be used in the long term (more than one year).
Interest expense and sales are part of the operating budget, not the capital expenditures budget. The sale of plant assets is a source of funds, not an expenditure, so it would not be included in the capital expenditures budget.
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