[Verse 1]
Sarah buys a printer for her growing store
Five hundred dollars, what's it counted for?
Will it last beyond this fiscal year?
Then capitalize, make the choice clear
But if it's used up quick, twelve months or less
Expense it now, don't make a mess
[Chorus]
Future benefits, lasting long
Capitalize and sing this song
Used up fast in current time
Expense it out, that's the rhyme
Cap-Ex builds the balance sheet
Op-Ex hits the income neat
[Verse 2]
Tommy's factory needs a metal press
Fifty thousand, built to last no less
Than fifteen years of steady production
Asset column gets this contribution
Monthly wear becomes depreciation
Spreading costs across the duration
[Chorus]
Future benefits, lasting long
Capitalize and sing this song
Used up fast in current time
Expense it out, that's the rhyme
Cap-Ex builds the balance sheet
Op-Ex hits the income neat
[Bridge]
Materiality matters too
Small amounts, just expense right through
Even if they last for years
Paperwork just interferes
Set a threshold, draw the line
Keep your records clean and fine
[Verse 3]
Research costs are tricky ground
Most get expensed when they're found
Development might get deferred
If success can be assured
Patent fees and legal rights
Capitalize those future sights
[Chorus]
Future benefits, lasting long
Capitalize and sing this song
Used up fast in current time
Expense it out, that's the rhyme
Cap-Ex builds the balance sheet
Op-Ex hits the income neat
[Outro]
When in doubt, remember this
Future value gets the bliss
Of the balance sheet's embrace
Current costs find income's space