Which of the following is NOT an example of capital expenditure?

Subsidies given to state government

The correct answer is option 1: Subsidies given to state government

Capital expenditure refers to spending on assets that will benefit the business or organization in the long term. Subsidies, on the other hand, are payments made by the government to individuals or businesses to support a particular activity or industry. They are typically considered revenue expenditures and do not create long-term assets.

Here are the other options and why they are examples of capital expenditure:

 Investment in shares: Investing in shares is considered a capital expenditure as it is an investment in a long-term asset.

Loan by central government to state government: This is a capital expenditure as it creates a long-term asset for the state government.

Repayment of loan: It is considered a capital expenditure as it reduces a long-term liability.