1. Paper F2 Management Accounting
2019/5/5

2. Chapter 18 Capital expenditure budgeting
2019/5/5

3. Capital expenditure budgeting Non-current assets purchase budget
Chapter Preview
Capital expenditure budgeting
Revenue expenditure
Capital expenditure
Non-current assets purchase budget
2019/5/5
Ji Weili, JXUFE

4. Identify capital and revenue expenditure
Revenue expenditure results from the purchase of goods and services that either used fully in the period or become current assets.
Capital expenditure results in the purchase or improvement of non-current assets .
2019/5/5
Ji Weili, JXUFE

5. Example
Which of the following would be part of the capital expenditure budget?
1 Purchase of a new factory premises
2 Replacement of existing machinery
3 Refurbishment of existing factory premises
4 Purchases of raw materials
A 1 and 2 only B 3 and 4 only
C 1,2 and 3 only D and 4 only
2019/5/5
Ji Weili, JXUFE

6. Related terms
Working capital 营运资本（金）--广义指流动资产总额，研究资产的流动性和周转状况时使用，狭义指流动资产减去流动负债后的差额，研究偿债能力和财务风险时使用。
Capital income 资本利得
Revenue income 经营收益
2019/5/5
Ji Weili, JXUFE

7. Capital expediture budget
Key points:
--short, medium and long term considerations
--suitable financing must be arranged
--must be reviewed in relation to the other budgets
2019/5/5
Ji Weili, JXUFE

8. Enough already! I need a break!
2019/5/5
Ji Weili, JXUFE