Revenue and Capital Expenditures
1.Classify the following as either a revenue or a capital expenditure.
A.Paid $40,000 cash to replace a compressor on a refrigeration system that extends its useful life by four years.
B.Paid $200 cash per truck for the cost of their annual tune-ups.
C.Paid $175 for the monthly cost of replacement filters on an air-conditioning system.
D.Completed an addition to an office building for $225,000 cash.
2.Prepare the journal entries to record transactions A.and D.of part 1.