The treatment of repairs and additions to property,plant and equipment can be best described as:
A) written off as incurred.
B) capitalised when it maintains a certain level of service.
C) capitalised when the asset's estimated useful life is extended.
D) None of the given answers.
E) capitalised when it maintains a certain level of service and capitalised when the asset's estimated useful life is extended.

Question

Quizplus · Accepted Answer

Repairs and additions to property, plant, and equipment are capitalized when they extend the asset's estimated useful life, as this adds value to the asset.

The Treatment of Repairs and Additions to Property,plant and Equipment