A substantial amount spent to improve the quality or extend the life of a long-term asset is a revenue expenditure.

Question

Quizplus · Accepted Answer

A substantial amount spent to improve the quality or extend the life of a long-term asset is a capital expenditure, not a revenue expenditure. Revenue expenditures are expenses incurred in the normal course of business to generate revenue such as rent, salaries, and advertising.

A Substantial Amount Spent to Improve the Quality or Extend