Capital Expenditure - CAPEX
 |
Definition of 'Capital Expenditure - CAPEX'Funds used by a company to acquire or upgrade physical assets such as property, industrial buildings or equipment. This type of outlay is made by companies to maintain or increase the scope of their operations. These expenditures can include everything from repairing a roof to building a brand new factory. |
 |
Investopedia explains 'Capital Expenditure - CAPEX'The amount of capital expenditures a company is likely to have depends on the industry it occupies. Some of the most capital intensive industries include oil, telecom and utilities.In terms of accounting, an expense is considered to be a capital expenditure when the asset is a newly purchased capital asset or an investment that improves the useful life of an existing capital asset. If an expense is a capital expenditure, it needs to be capitalized; this requires the company to spread the cost of the expenditure over the useful life of the asset. If, however, the expense is one that maintains the asset at its current condition, the cost is deducted fully in the year of the expense. |
 |
Related Video for 'Capital Expenditure - CAPEX'
|
Related Definitions
Articles Of Interest
-
Depreciation: Straight-Line Vs. Double-Declining Methods
Appreciate the different methods used to describe how book value is "used up". -
Analyze Cash Flow The Easy Way
Find out how to analyze the way a company spends its money to determine whether there will be any money left for investors. -
Capital Expenditures (CAPEX)
Learn more about what it costs to produce goods. -
Trust In Utilities
Even in times of economic turmoil, utilities can be a good investment. -
Free Cash Flow: Free, But Not Always Easy
Free cash flow is a great gauge of corporate health, but it's not immune to accounting trickery. -
Unearth Profits In Oil Exploration And Production
Drill down into financial statements to tap into the right companies and let returns flow. -
Discounted Cash Flow Analysis
Find out how analysts determine the fair value of a company with this step-by-step tutorial and learn how to evaluate an investment's attractiveness for yourself. -
Financial Statement: Extraordinary Vs. Nonrecurring Items
When it comes to analyzing a company, successful analysts spend considerable time differentiating between accounting items that are likely to recur going forward from those that most likely will ... -
Get A Career In Showbiz Accounting
An accounting career doesn't have to be boring. If you love numbers, but want excitement as well, consider the field of showbiz accounting. -
What Management Accountants Do
If you like keeping track of a company's income and expenses but also want to hold a position with significant responsibility and authority, management accounting could be the job for you.
Free Annual Reports
