What this practice covers
These questions are drawn from past CIE 9706 Accounting papers and filtered to capital and revenue expenditure. You answer, you find out immediately whether you were right, and you get the reasoning for the correct option and for each distractor. Wrong answers go to a mistakes locker so you can come back to exactly those.
Practice is free. You need an account only so your progress and your mistakes are still there next time.
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What examiners see students get wrong here
These are the errors that cost marks on capital and revenue expenditure, taken from our own topic notes. Read them before you practise and you will recognise the traps in the questions.
- Capitalising the whole invoice, including insurance, licence, fuel or training.
- Treating proceeds from selling an asset as sales revenue.
- Saying the trial balance would reveal the misclassification. It will not.
- Stating the effect on profit but not on the statement of financial position, when the question asks for the effect on the financial statements.
- Forgetting that overstating an asset also overstates the following year's depreciation charge.
- Treating a loan received as income.
Revise it first
If any of the above is unfamiliar, work through the notes before practising: Capital and revenue expenditure revision notes.