The cost of ordinary repairs should be recognized when incurred as revenue expenditures.

Question

Quizplus · Accepted Answer

According to the matching principle of accounting, revenue expenditures, such as ordinary repairs, should be recognized when incurred, rather than capitalized as assets. This means that their cost should be recorded as an expense in the period in which they are incurred, and not treated as a long-term investment in the company's fixed assets.

The Cost of Ordinary Repairs Should Be Recognized When Incurred