During the year an extension was bulit on the Shop Premises. At the same time,the original shop was redecorated and the flooring was replaced. The cost for this work were as follows:

Decoration of Original Shop £2200
Replacement of Flooring £1300

Which one would be Capitalzed or Revenue Expenduture.

Please reply early. Thanx a lot.

I think Replacement Flooring would be considered as a Capitalized Expenditure because its the part of the Premises thats asset.

You could make a strong argument to capitalize or expense both the floor replacement and the decorating.

But without knowing more specific facts, it is all a grey area.

The flooring probably should be capitalized and the decorating expensed, but it doesn’t have to be like that.