1. Classify the following as either a revenue expenditure or a capital expenditure. a. Paid $40,000 cash...
Question:
1. Classify the following as either a revenue expenditure or a capital expenditure.
a. Paid $40,000 cash to replace a motor on equipment 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 a building for $225,000 cash.
2. Prepare the journal entries to record the four transactions from part 1.
Step by Step Answer:
Req 1 Transaction Nature of transaction a Capital expenditure b Re...View the full answer
Financial Accounting Information For Decisions
ISBN: 9781260705584
10th Edition
Authors: John J. Wild
Related Video
A journal entry is an act of keeping or making records of any transactions either economic or non-economic. Transactions are listed in an accounting journal that shows a company\'s debit and credit balances. The journal entry can consist of several recordings, each of which is either a debit or a credit
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