Capital expenditures as well as sales of goods impact the financial statement, but both do so differently. A capital expenditure usually does not have an immediate impact but can immediately impact the financial statement depending on the type of asset. When it comes to merchandise sales, there are a few ways it will affect your financial statement, but it depends on how the merchandise was sold. There are many ways that capital expenditures and merchandise sales affect the financial statement, but how they do so depends on certain factors during the transaction. Businesses often make capital expenditure during the financial year. This cost is the amount you pay to upgrade or purchase a long-term asset, such as a car or computer. The cost of a capital expenditure does not have an immediate impact on the income statement. It steadily reduces balance sheet revenue over the life of the asset through depreciation. Only the purchase of improvements to existing assets and new assets meets the requirements to be considered capital expenditure. Update...