Question : Which of the following is not a capital expenditure?
Option 1: Loans and advances by the central government
Option 2: Expenditure on the acquisition of land
Option 3: Investment in shares
Option 4: Subsidies payment
Correct Answer: Subsidies payment
Solution : The correct option is Subsidies payment .
A subsidy is an advantage given to an individual, business, or organisation by the government. Direct subsidies, such as cash transfers, or indirect subsidies, like tax cuts, are two possible types of subsidies.
Capital expenditure refers to an amount spent to acquire or upgrade productive assets to increase the efficiency or capacity of the company for more than one accounting period.
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