On June 1, Roadway's Trucking Company Paid $7000 to Overhaul

On June 1, Roadway's Trucking Company paid $7000 to overhaul the engine on a delivery truck to allow it to be used for two additional years. It also paid $8500 to change the storage capacity of the truck so that it could haul more merchandise. Which of the following statements is TRUE?

A) The $7000 is a capital expenditure and the $8500 is an expense.
B) The $7000 is an expense and the $8500 is a capital expenditure.
C) Both items are capital expenditures.
D) Both items are expenses.