Skip to main content
Super TutorResources
Chapter 18 of 28
Revision Notes

Capital and Revenue Expenditure/ Income — Revision Notes

ICSE · Class 11 · Accountancy

Capital and Revenue Expenditure/ Income revision notes for ICSE Class 11 Accountancy: 4 topics in quick points.

65 questions32 flashcards5 concepts

Interactive on Super Tutor

Studying Capital and Revenue Expenditure/ Income? Get the full interactive chapter.

Quizzes, flashcards, AI doubt-solver and a step-by-step study plan — built for revision notes and more.

Try Super Tutor — Free

Free trial, no card needed.

Key Topics to Revise

1

1. Core Idea of Capital and Revenue

  • Distinguishing capital and revenue items is essential because revenue items go to the Trading and Profit and Loss Account while capital items go to the Balance Sheet.
  • Failure to distinguish capital and revenue items leads to incorrect profit and unfair financial position.
  • There is no fixed universal rule to distinguish capital and revenue expenditure; classification depends on business context.
2

2. Capital Expenditure and Revenue Expenditure

  • Capital expenditure is expenditure resulting in acquisition of an asset or an increase in the earning capacity of business.
  • Capital expenditure is of permanent nature and can be seen and touched.
  • Capital expenditure increases earning capacity and appears on the assets side of the Balance Sheet.
3

3. Capital Income and Revenue Income

  • Capital income is income not pertaining to business operations.
  • Profit on sale of fixed assets is capital income.
  • Revenue income arises out of and in the course of regular business transactions.
4

4. Capital Receipts and Revenue Receipts

  • Capital receipts are receipts of non-recurring nature.
  • Capital receipts include capital from proprietor, loans, deposits, sale proceeds of investments, and sale proceeds of fixed assets.
  • Capital receipts mostly appear on the liabilities side of the Balance Sheet.

Get complete notes with diagrams and examples

Full Notes

Key Concepts

Capital expenditure is expenditure that resultsRevenue expenditure arises out of regularCapital income is income that doesRevenue income arises out of regularCapital receipts are non

Frequently Asked Questions

What are the important topics in Capital and Revenue Expenditure/ Income for ICSE Class 11 Accountancy?
Key topics in Capital and Revenue Expenditure/ Income include Core Idea of Capital and Revenue, Capital Expenditure and Revenue Expenditure, Capital Income and Revenue Income, Capital Receipts and Revenue Receipts. Study these first, then practise questions on each for Class 11 exams.
How should I revise Capital and Revenue Expenditure/ Income for Class 11 exams?
Learn the core ideas first, then work through the 65 practice questions on Capital and Revenue Expenditure/ Income. Revise definitions regularly and use flashcards for quick recall before the exam.

Sources & Official References

Content is aligned to the official syllabus. Refer to the board website for the latest curriculum.

More resources for Capital and Revenue Expenditure/ Income

All ICSE Class 11 Accountancy Revision Notes

For serious students

Get the full Capital and Revenue Expenditure/ Income chapter — start free.

Quizzes, flashcards, an AI doubt solver and a study plan for ICSE Class 11 Accountancy. Free to start, no card needed.

Try Super Tutor Free
Try this chapter free