Replies to post #60346 on Southridge Enterprises Inc (SRGE)

[grego68]

I just showed 2 places where it confirms that acquiring a business or any revenue generating asset is a capital expenditure. Saying it is not will not change the fact that it is

[Sooah]

Wrong again. Grego is right here. The rule concerning capital expenditure (CAPEX) is a very simple test of whether the asset in question can be depreciated or depleted (since here we are talking about land with resources)within one accounting period. If the expense (cost) related to the asset can be written off in one year, it goes on the income statement, otherwise it must be capitalized and stated as an asset on the Balance Sheet. Land/property acquisitions follow the latter. Nice try though.