Which of the statements below is TRUE?
A)Ordinary repairs should not be capitalized.
B)Expenditures that increase the working life of an asset should not be capitalized.
C)Expenditures that increase the efficiency of an asset should not be capitalized.
D)Ordinary repairs reduce the carrying value of an asset.

Question

Quizplus · Accepted Answer

Ordinary repairs are considered maintenance expenses and should not be capitalized. Capitalizing these expenses would result in overstating the value of the asset on the balance sheet.

Which of the Statements Below Is TRUE