capital expense

Long-term asset cost

A capital expense is money spent on assets expected to provide value over multiple years—buildings, equipment, machinery, vehicles.

Businesses distinguish capital expenses from operating expenses, which cover day-to-day costs like rent and salaries.

Capital expenses are typically depreciated over time rather than deducted immediately.

Often abbreviated CapEx: The company's CapEx budget includes a new manufacturing facility.

accounting

depreciation

Asset value reduction over time

fixed assets · tangible assets · intangible assets · ledger · write-off · useful life · salvage value · cost basis · impairment · recognition

procurement

acquisition

Act of obtaining something

computers · software · hardware · furniture · fixtures · property · building · purchase order · vendor · installation

infrastructure

facilities

Provided spaces and equipment

electrical · plumbing · roofing · structural · foundation · parking · security systems · data center · network infrastructure · telecommunications

improvement

renovation

Restoring to good condition

retrofit · modernization · refurbishment · remodeling · overhaul · replacement · addition · enhancement · conversion · restoration

budgeting

allocation

Distribution of shares

forecast · planning · approval · authorization · cost estimate · phasing · contingency · prioritization · annual budget

Categories
Opposites
expenditure classification

capital expenseoperating expense

Ongoing business expenditure

operating cost · maintenance cost · overhead · variable cost · fixed cost

cash flow direction

capital expensecapital income

Earnings from investments

revenue · capital gain · investment return · proceeds · dividend income

expense classification

capital expenseoperating expense

Ongoing business expenditure

operating costs · overhead costs · administrative expenses · variable costs

Family

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