Capital expenditure or operating expenditure

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If Halley Industries reimburses employees who earn master's degrees and who agree to remain with the firm for an additional 4 years, should the expense of the tuition reimbursement be categorized as a capital expenditure or an operating expenditure?

a. The tuition reimbursement should be categorized as a operating expenditure since the outlay of funds is expected to produce benefits over a period of time greater than 1 year

b. The tuition reimbursement should be categorized as a capital expenditure since the outlay of funds is expected to produce benefits over a period of time greater than 1 year

c. The tuition reimbursement should be categorized as a capital expenditure since the outlay of funds represents an expense incurred in transacting normal business operations

d. The tuition reimbursement should be categorized as a operating expenditure since the outlay of funds represents an expense incurred in transacting normal business operations

Reference no: EM13933617

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