Capex & Opex

Capex and Opex are two important financial terms used in business and finance to distinguish between different types of expenses.
Capex (Capital Expenditure): Capex refers to the expenses a company incurs to acquire, upgrade, or maintain physical assets such as buildings, equipment, machinery, or vehicles. Capex is recorded on the company’s balance sheet as an asset and is typically depreciated or amortized over its useful life.

Opex (Operating Expenditure): Opex refers to the day-to-day expenses that a company incurs in order to operate its business. These expenses are directly related to the company’s ongoing operations and are incurred regularly, usually within a short period. Opex is recorded on the company’s income statement as an expense in the period in which it is incurred.

Distinguishing between capex and opex is important because they have different implications for financial analysis, taxation, and reporting

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