The following expenditures were among those incurred by JB during the year ended December 31, 2013: Replacement of tiles on portion of roof that had been leaking = $4,000
Overhaul of machinery that is expected to extend its useful life for another two years = $6,000
How much should be charged to repairs and maintenance expense in 2013?

Question

Quizplus · Accepted Answer

The replacement of tiles on the roof due to leakage should be charged to repairs and maintenance expense. The machinery overhaul, however, is expected to extend its useful life for another two years, which means it should be capitalized and recorded as an asset rather than an expense. Therefore, only $4,000 should be charged to repairs and maintenance expense in 2013.

The Following Expenditures Were Among Those Incurred by JB During