Essay
Unit 5 - P2
- Module
- Unit 5 - Business Accounting
- Institution
- PEARSON (PEARSON)
explain the difference between capital and revenue items of expenditure and income
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Capital Income - Is the income generated by an asset over time, rather than work of theassets.
Capital Expenditure - Is the money spent by a business or organisation on maintaining
and upgrading fixed assets such as; land, buildings and equipment.
Revenue Income - Is the amount earned by the business by sales of goods and services.
Revenue Expenditure - An amount expensed immediately or within the year to which it
occurred.
Apple
Capital Income
As Apple is a public limited company, Apple has shares on the stock market to which
anyone can purchase. This can generate an amount of capital income. Apple also has a
very distinguishable product design, patents and trademark; such as their logo which takes
advantage of their intangible assets.
Capital Expenditure
Apple which is a multinational company has many different stores globally which are
always changing to become more modern resulting in a large amount of expenditure on
land, building/property and equipment for the products. Apples Capital Expenditure in 2016
was 12.7 billion to which it decreased in 2017 to 12.5 billion and again increased in 2018
for 14.1 billion.
Revenue Income
Apple which has a large range of products that are constantly improving and being
redesigned through the sales of their products; Iphones, Macbooks, Tablets and other
accessories and devices, they generated an income of $265 billion an average of 16%
increase than 2017, worldwide.
Revenue Expenditure
For Apple to manage their multinational company they require their revenue expenditure to
maintain a high standard, having storefronts globally. As there is a large employee pool
ranging from different skills and jobs from computer programmer to cashier, administrative
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