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State whether each transaction is a Capital receipt or a Revenue receipt.

i) Cash sales
ii) Loan from a bank
iii) Discount received
iv) Commission received
v) Sale of a motor vehicle



Answer :

GinnyAnswer

Final answer:

In business finance, transactions like cash sales, loans from banks, and sale of motor vehicles are considered capital receipts, whereas discount received and commission received fall under revenue receipts.


Explanation:

Capital Receipts:

  1. Cash sales
  2. Loan from a bank
  3. Sale of a motor vehicle

Revenue Receipts:

  1. Discount received
  2. Commission received

Capital receipts involve transactions that lead to an increase in the organization's assets or decrease in liabilities, while revenue receipts are related to income generation from regular business activities.


Learn more about Capital and Revenue Receipts here:

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