Answer: D. Extension of building

Explanation:
The correct answer is D because capital expenditure refers to funds used by an organization to acquire or upgrade physical assets such as property, buildings, or equipment. The extension of a building is a capital expenditure because it enhances the value of the existing building and is expected to provide long-term benefits.

Run down:
The selected answer is D since extending a building qualifies as capital expenditure. It involves upgrading a long-term asset, which aligns with the definition of capital expenditure.