1. Classify the following expenditures as Repairs and Maintenance Expense or Betterment:

a. The monthly replacement cost of filters on an air conditioning system, $120.

b. The cost of replacing a compressor for an ice cream company’s refrigeration system that extends the estimated life of the system by four years, $40,000.

c. The cost of annual tune-ups for delivery trucks, $200.

d. The cost of $175,000 for an addition of a new wing on an office building.

2. Prepare the journal entry to record each of the above (assume all transactions occurred on March 15, 2020, and were on account).