Which budget type focuses on major purchases and long-term investments for equipment or buildings?

• A. Operating
• B. Line-item
• C. Capital
• D. Program

Answer: (C)

Capital budgeting is about planning for long-term, high-cost investments such as new equipment or buildings. It focuses on major purchases that will be used for many years and typically require a separate process to evaluate, finance, and track these assets. That makes it the right choice when the question asks for focusing on long-term investments and equipment or buildings.

In contrast, the operating budget covers day-to-day expenses needed to run the department—things like salaries, utilities, and supplies that recur each year. The line-item budget is a format that lists these costs by category or line item, rather than describing the purpose or duration of the spending. The program budget organizes spending by programs or projects rather than by assets or long-term investments.