On Wed, 13 Aug 2008 07:43:31 -0700 (PDT), PeterSaxton
 wrote:

>> In the Cash Book you have an Income side and an Expenditure side. If
>> you have Expenditure on purchasing a car, purchasing a car is an
>> Expense.-
>
>I disagree with your contention that expenditure equates to expense.
>
>Capital expenditure is not an expense.

expense 
n	noun 
1	the cost incurred in or required for something. Ø(expenses)
costs incurred in the performance of a job or task. 
2	something on which money must be spent. 


It may not be allowable as a deduction against trading profits, but it
is still an expense of the business.

--
Alan "Ferrit" Ferris

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On Fri, 15 Aug 2008 00:15:42 -0700 (PDT), PeterSaxton
 wrote:

>On 14 Aug, 08:35, Alan Ferris  wrote:
>> On Wed, 13 Aug 2008 07:43:31 -0700 (PDT), PeterSaxton
>>
>>  wrote:
>> >> In the Cash Book you have an Income side and an Expenditure side. If
>> >> you have Expenditure on purchasing a car, purchasing a car is an
>> >> Expense.-
>>
>> >I disagree with your contention that expenditure equates to expense.
>>
>> >Capital expenditure is not an expense.
>>
>> expense
>> n       noun
>> 1       the cost incurred in or required for something. Ø(expenses)
>> costs incurred in the performance of a job or task.
>> 2       something on which money must be spent.
>>
>> It may not be allowable as a deduction against trading profits, but it
>> is still an expense of the business.
>>
>You seem to have got hopelessly confused with who said what.
>
>Using a general dictionary to justify a technical subject isn't
>sensible.

It was still an expense of the business... no mater whether you wish
to be technical or not.

--
Alan "Ferrit" Ferris

 ()'.'.'()
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 ( ) . ( )
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PeterSaxton wrote:

> On 15 Aug, 17:38, Alan Ferris  wrote:
>> On Fri, 15 Aug 2008 00:15:42 -0700 (PDT), PeterSaxton wrote:
>> >On 14 Aug, 08:35, Alan Ferris  wrote:
>> >> On Wed, 13 Aug 2008 07:43:31 -0700 (PDT), PeterSaxton
>> >> >
>> >> >Capital expenditure is not an expense.
>> >> 
>> >> It may not be allowable as a deduction against trading profits, but it
>> >> is still an expense of the business.
>> >
>> >Using a general dictionary to justify a technical subject isn't
>> >sensible.
>>
>> It was still an expense of the business... no mater whether you wish
>> to be technical or not.
> 
> Buying the car isn't an expense. The depreciation of the cost of the
> expenditure is the expense.
> 
> You buy a car for £10,000 and expect it to last for four years with no
> resale value. What is the expense to the business in the following
> years?
> year 1
> year 2
> year 3
> year 4

There are many different valid answers to that.

One of them is the one you prefer, which I presume is £2500 each year.
Or you could depreciate in line with what the likely market value
drop will be in each year, perhaps £5000, £2500, £1250, £1250.
Another might be £10k in year 1 and nothing in the other 3 years.
Another might be £3333 in each of years -2, -1, and 0, on the basis
that in those years the money was set aside to save for the purchase.

Linear expensing in four equal tranches makes a lot of sense when the
money is borrowed and repaid over 4 years, even if it turns out the
car is expected to last, say, 6 years.  But where there is no borrowing,
it makes less sense, unless you contruct the fiction that you are
borrowing the money from yourself.

Tax rules impose yet another regime, divorced from reality.

On Sun, 17 Aug 2008 01:40:19 -0700 (PDT), PeterSaxton
 wrote:

>> It was still an expense of the business... no mater whether you wish
>> to be technical or not.
>>
>Buying the car isn't an expense. 

ROFL   only when it is a gift.

--
Alan "Ferrit" Ferris

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