CONCEPTUAL CONNECTION Classify each cost as part of the overhaul or as an expense. Be sure to explain your reasoning for each classification. Exercise 7-55 Expenditures After Acquisition The following expenditures were incurred during the year: a. Paid $4,000 for an overhaul of an automobile engine. b. Paid $20,000 to add capacity to a cellular phone company's wireless network c. Paid $200 for routine maintenance of a manufacturing machine. d. Paid $10,000 to remodel an office building. e. Paid $300 for ordinary repairs Required: 1. Classify the expenditures as either capital or revenue expenditures. 2. CONCEPTUAL CONNECTION If management improperly classified these expenditures, what would be the impact on the financial statements