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Question
ASSERTION: Painting and lettering the new office car is Capital expenditure.
REASONING: A replacement engine fitted to the delivery van is Revenue expenditure.
Options
A is true, and R is the correct explanation for A.
A is true, and R is not the correct explanation for A.
A is true, but R is false.
A is false, but R is true.
MCQ
Assertion and Reasoning
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Solution
A is true, and R is not the correct explanation for A.
Explanation:
Painting and lettering a newly acquired office car are capital costs because they prepare the asset for use; fitting a replacement engine is maintenance (revenue). R is true, but does not explain A.
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