For each of the following items, indicate whether each would be treated as a
-Costs incurred after putting the asset into service which would extend the asset's useful life
A)capital expenditure
B)revenue expenditure

Question

Quizplus · Accepted Answer

Capital expenditures are costs incurred to acquire or improve a fixed asset, such as a building or equipment, which extend the asset's useful life, increase its capacity, efficiency, or improve its quality, thereby enhancing its future economic benefits. Revenue expenditures, on the other hand, are short-term expenses necessary for the maintenance of the asset or for the day-to-day operation of the business, and do not extend the asset's useful life beyond its original estimate.

For Each of the Following Items, Indicate Whether Each Would