# Is it true that we typically consider the operating costs, but for a “long lasting item”, we make it a capital expenditure and depreciate it? [closed]

When investing in companies, I have to understand what "capital expenditure" is. It seems that we typically consider how much we take in (sales or revenue) and deduct the costs and arrive at net income each year, but for costs that actually is long lasting, such as a computer or a roof, we would first classify it as "capital expenditure" and then not consider it a cost directly, but "depreciate it", which is to divide the amount by 6 or 30 and make it the "depreciation cost", in a way dividing up the purchase price as a cost for each year?

However, it is strange that painting of the house or warehouse is actually an operating cost, instead of capital expenditure? Nowadays a computer may last 6 years, and painting can last 12 years, so the painting lasts longer than a computer but yet we consider the computer purchase a capital expenditure but the painting an operating cost?

• I can sell a computer separately, I don't think I can sell the paint off a factory. Perhaps you can pick a better example. – Morrison Chang Nov 11 '19 at 5:50
• @MorrisonChang but you can't sell the roof separately too. I think fixing or putting a new roof on is capital expenditure, vs the painting is not. So it may not depend whether you can sell it separately – nonopolarity Nov 11 '19 at 6:18
• I believe you need to get a basic accounting book to go through to figure out all your queries. Do you have a library near your home or just google for a basic accounting book. – DumbCoder Nov 11 '19 at 15:21
• – D Stanley Nov 11 '19 at 18:09
• How is this different from your earlier question? – D Stanley Nov 11 '19 at 18:10