Which of the following defines capital expenditures?

Capital expenditures refer to funds that are spent to acquire, upgrade, or maintain non-consumable assets. These assets often include physical properties like buildings, machinery, and equipment that are essential for the ongoing operations of an organization. By investing in capital expenditures, a company aims to improve its productive capacity or extend the useful life of an asset. This process enhances the company's efficiency and ultimately contributes to its growth.

In contrast, regular operating costs entail day-to-day expenses, such as utilities and supplies, which are essential for keeping the organization running but do not involve the acquisition of long-term assets. Temporary project budgets generally concern short-term initiatives that do not result in lasting physical assets. Similarly, employee salaries are a form of operating expense that compensates the workforce but do not fall under the category of capital expenditures. Understanding the differences between these categories helps in effective financial planning and investment decision-making.