Q3:

On December 1, X5, the company received an invoice for repairs it has just carried out on one of these production equipments. The invoice, which amounts to $20,000, was not recorded by the accountant. The latter expects to settle this invoice in January X6. Based on this information, indicate the correct answer below.

The amount of the repair should be distributed between years X5 and X6.

None of the above

The amount of the repair should be recorded as an expense for the year X6,

or when paying the invoice.

The amount of the repair should be added to the cost of the equipment (capitalization) since this expense increases the service potential of the asset.

This corresponds to an account payable for X5. The repair amount should be recorded as an expense for year X5 through an adjustment entry.