A major expenditure increased a truck's life beyond the original estimate of life. GAAP permits the expenditure to be debited to:
A)Repairs.
B)Accumulated depreciation.
C)Major repairs.
D)None of these.

Question

Quizplus · Accepted Answer

Under GAAP, if a major expenditure extends the useful life of an asset, it should be debited to Accumulated Depreciation, effectively reducing the accumulated depreciation and increasing the asset's book value.

A Major Expenditure Increased a Truck's Life Beyond the Original