Enter the current PP&E, past PP&E, and the depreciation over the same time period into the calculator to determine the total capital expenditure.
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Capital Expenditure Formula
The following formula is used to calculate a total capital expenditure.
CapEx = PPEc – PPEp + D
- Where CapEx is the capital expenditure
- PPEc is the current period property, plant, & equipment
- PPEp is the previous property, plant, & equipment
- D is the total depreciation
Capital Expenditure Definition
A capital expenditure is a measure of the total capital spent by a company to produce a good or service.
Capital Expenditure Example
How to calculate capital expenditure?
- First, determine the PPE of the current period.
Determine the total value of the property, plant, & equipment of the current period.
- Next, determine the PPE of the previous period.
Determine the total value of the PPE of the previous period being analyzed.
- Next, determine the total depreciation.
Calculate the total depreciation of the PPE over the time period.
- Finally, calculate the capital expenditure.
Calculate the capital expenditure using the formula above and the values for PPE and depreciation.
Capex is short for capital expenditure and is a measure of the total capital spent on major physical goods or services that a company will use for a long period of time.