An acronym for Capital Expenses, CapEx refers to business costs associated with acquiring, developing or upgrading physical assets such as hardware systems or intangible assets like patents and other intellectual property.
Capital expenditures stand in contrast to operating expenditures, or OpEx, which are the ongoing costs associated with the daily operations of business products, services and/or systems.
CapEx from an Accounting Perspective
From an accounting perspective, CapEx or capital expenditures refer to business costs allocated to creating future benefits, such as acquiring new fixed assets or upgrading existing ones.
The monetary benefits from CapEx costs are expected to extend beyond the current tax year, and as a result, CapEx costs typically need to be accounted for on income statements with depreciation (tangible assets) or amortization (intangible assets such as patents or other intellectual property) factored into the equation.
Stay up to date on the latest developments in Internet terminology with a free weekly newsletter from Webopedia. Join to subscribe now.
List of free online Java courses for students and IT professionals looking to enhance their skills . Read More »SEO Dictionary
From keyword analysis to backlinks and Google search engine algorithm updates, our search engine optimization glossary lists 85 SEO terms you need... Read More »Slideshow: History of Microsoft Operating Systems
Microsoft Windows is a family of operating systems for personal computers. In this article we look at the history of Microsoft operating... Read More »
Java is a high-level programming language. This guide describes the basics of Java, providing an overview of syntax, variables, data types and... Read More »Java Basics, Part 2
This second Study Guide describes the basics of Java, providing an overview of operators, modifiers and control Structures. Read More »The 7 Layers of the OSI Model
The Open System Interconnection (OSI) model defines a networking framework to implement protocols in seven layers. Use this handy guide to compare... Read More »