HOTSPOT - For each of the following statements, select Yes if the statement is true. Otherwise, select No. NOTE: Each correct selection is worth one point. Hot Area:
Correct!! Paying for electricity is considered Operating Expenditure (Opex) because it is a recurring cost required to run the business's day-to-day operations.
Key Points:
Opex (Operating Expenditure): Includes expenses for ongoing operational activities, such as utilities (electricity, water), rent, salaries, and maintenance.
Capex (Capital Expenditure): Refers to investments in long-term assets, such as purchasing equipment, upgrading facilities, or building infrastructure.
Since electricity is a recurring, short-term expense essential for business operations, it falls under Opex.
Correct answer for 2nd question (electricity in own Datacenter) is OpEx.
Pretty sure about that as only mistake highlighted in my exam score was in area Azure Core Services, which is not the category for this question. And I put there Opex.
Azure Pay-As-You-Go pricing is an example of CapEx.
❌ No – Pay-As-You-Go is an Operational Expenditure (OpEx) since you pay for what you use without upfront costs.
Paying electricity for your datacenter is an example of OpEx.
✅ Yes – Electricity is a recurring cost, which is considered Operational Expenditure (OpEx).
Deploying your own datacenter is an example of CapEx.
✅ Yes – Setting up a datacenter requires significant upfront investment in infrastructure, which is Capital Expenditure (CapEx).
The answer is NYY. CoPilot: 1. Nope, Azure's Pay-As-You-Go pricing is an example of Operational Expenditure (Opex).2. Yes, paying for electricity for your datacenter is a prime example of Operational Expenditure (Opex), 3. Yes, deploying your own datacenter is an example of Capital Expenditure (CapEx).
Answer is NYY
Operating Expenses (Opex): These are the ongoing costs for running a business's day-to-day operations. Expenses such as utilities (like electricity), rent, maintenance, and salaries fall under Opex. They are typically variable costs that can change based on usage and are recorded on the income statement.
Capital Expenditures (Capex): These are funds used by a company to acquire, upgrade, and maintain physical assets such as buildings, machinery, and equipment. Capex is typically a one-time investment that provides long-term benefits and is recorded on the balance sheet.
Yes, paying electricity for a data center is classified as an operational expense (OpEx). OpEx refers to the ongoing costs required for the day-to-day functioning of a business, which includes utilities such as electricity.
Number 2 is totally debatable and has to be thought about in the Microsoft way not in a logical or accountancy way. What does Microsoft think electricity bills represent Capex or OpEx? To make themselves look for attractive I would say CapEx
Paying for electricity is OpEx. Just like cloud is OpEx because you pay as you go, so is the electricity that you use each month.
If you were talking about the build out of your data center and laying the wiring, that would be CapEx.
ChatGPT says yes:
"Yes, paying for electricity for your datacenter is an example of operational expenditure (opex).
Operational expenditures (opex) are the ongoing costs for running a product, business, or system. This includes expenses such as utilities, rent, salaries, maintenance, and other regular expenses required to keep the business operational. In the context of a datacenter, electricity is a recurring expense necessary for its operation, making it an opex."
Direct from MS:
"Paying electricity for a data center is an example of an operational expense (OpEx). Operational expenses refer to the ongoing costs incurred in the day-to-day operations of a business or organization."
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