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Definition of "Capital Expenditure" |
A capital expenditure (Capex) is money invested by a company to acquire or upgrade fixed, physical, non-consumable assets, such as buildings and equipment or a new business. There are two types of capital expenditure – those that are invested in to maintain existing levels of operation within a company and those that are invested in something new to foster future growth. Customarily, regardless of the manner of investment, capital expenditure is money spent with the intent of initiating future cash flow and a substantial ROI. capital expenditure counterpart, operational expenditures (Opex), refers to the day-to-day costs of operation. A similar but not closely related term, forex, stands for foreign exchange. |
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