We capitalize repairs and maintenance expenditures because they maintain a given level of benefits.
We expense repairs and maintenance expenditures in the period incurred because they maintain a given level of benefits.

Question

Quizplus · Accepted Answer

We capitalize expenditures that improve or enhance the benefits of an asset beyond its original level. Repairs and maintenance expenses, on the other hand, are expensed in the period incurred because they are necessary to keep the asset in its current condition and maintain its current level of benefits.

We Capitalize Repairs and Maintenance Expenditures Because They Maintain a Given