Elton Enterprises Has Recently Upgraded Its Delivery Truck Required:
1) Determine Whether the Expenditure Is a Capital Improvement

Elton Enterprises has recently upgraded its delivery truck. The various expenditures related to the upgrades occurred at the end of year 2 and are as follows:
$\begin{array}{lccc}\underline { \text { Item and amounts}}&\underline { \text { Capital expenditure/Operating expense}}\\ \text { 1) Oil changes, \$ 20 }&------\\ \text { 2) All four tires on truck replaced, \$ 800}&------\\ \text { 3) Engine replacement, \$ 900}&------\\ \text { 4) Changed truck colors from blue to green,\$ 500}&------\\ \text { 5) Replaced brakes, \$ 400}&------\\\end{array}$

Required:
1) Determine whether the expenditure is a capital improvement or ordinary operating expense.
2) Suppose the delivery truck with an original cost of $35,000 was being depreciated using straight line depreciation over 5 years and was expected to have a $3,000 residual value, however the upgrades are expected to increase the useful life from 5 years to 7 years. Based on the upgrades above, what is the revised depreciation expense for years 3 through 7?