Capital and revenue transactions can be divided into capital expenditures, revenue expenditures, capital receipts, and revenue receipts. Capital expenditures are non-recurring and increase business efficiency, such as purchasing fixed assets. Revenue expenditures are recurring day-to-day costs that support business operations, like administrative costs. Capital receipts come from non-recurring sources like asset sales, while revenue receipts are recurring income from normal business activities like sales. Some expenditures provide benefits over multiple periods and are considered deferred revenue expenditures, including heavy advertising costs.

1. capital and revenue expenditure

2. capital transactions
Divided in two elements:
Capital expenditure
Revenue expenditure

3. Capital expenditure
Increase operating efficiency of business and which is non recurring
Example:
Purchase of fixed asset,
Remodelling or reconditioning of fixed asset

4. Capital receipt
1)Which can be invested in business for more than 1 accounting period
2)The amount is not received in normal course of business
3)It is not recurring
Example:
sale of fixed assets, loans borrowed etc.

5. Revenue transaction
Revenue expenditure
Revenue receipt

6. Revenue income
1. Income earned during normal course of business
2. Recurring in nature
3. Example: sale of goods or service, interest received on
investment, commission received etc.

7. Revenue expenditure
1. Incurred in normal course of business
2. Recurring in nature
3. Day to day expenditures which support business
4. Example : Purchase exp, administrative expenditure, commission given,
travelling expenditure etc.

8. Deferred revenue expenditure
A heavy expenditure benefit of which can be gained for more than 1 accounting
period
Example:
heavy advertisement expenditure
expenditure on research and development etc.

9. Other terms
1. Capital profit
2. Revenue profit
3. Capital loss
4. Revenue loss