Capital Expenditure Vs. Revenue Expenditure

Capital expenditures are assets that are acquired to expand business capacity to earn or produce. Costs that are attributed to maintaining earnings or capacity are revenue expenditures.

      Accounting
  Revenue expenditures are noted on income statements and a capital expenditure is placed on       the   
  balance sheet.
      Working capital
  Although capital expenditures are typically machinery or some other physical asset, they       can also  
  include research and development. This is because research and development       expands production 
  ability, earnings and capacity.
      Industries  A capital expenditure in one industry may be a revenue expense in another company. One       example is a
  real estate company that purchases land or buildings for resale. This is not       a capital expenditure, even
  though it is a physical asset, because its purpose is to be       resold.
      Raw materials
   Although raw materials are used in the earnings process, and increasing the amount of raw       materials 
   that are purchased and used may increase production, these are revenue       expenditures.
      Day-to-day
   The day-to-day costs of running the business, including salaries, utilities, repairs,       maintenance, fees, rent
   and taxes are all revenue expenditures.