Which of the following types of expenditures should be capitalized in this instance
Which of the following types of expenditures should be capitalized in this instance
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question 9:
AICPA.083734FAR-SIM
Many years after constructing a plant asset, management spent a significant sum on the asset. Which of the following types of expenditures should be capitalized in this instance:
(1) an expenditure for routine maintenance that increases the useful life compared with deferring the maintenance,
(2) an expenditure that increases the useful life of the asset compared with the original estimate assuming normal maintenance at the required intervals,
(3) an expenditure that increases the utility of the asset.
| (1) | (2) | (3) | |
|---|---|---|---|
|
Yes |
Yes |
Yes |
|
|
No |
Yes |
Yes |
|
|
No |
No |
Yes |
|
|
No |
Yes |
No |
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