Revenue and capital expenditures

1. Classify the following as either a revenue expenditure or a capital expenditure.

o a. Paid $40,000 cash to replace a compressor on a refrigeration system that extends its useful life by four years.

o b .Paid $200 cash per truck for the cost of their annual tune-ups.

o c. Paid $175 for the monthly cost of replacement filters on an air-conditioning system.

o d. Completed an addition to an office building for $225,000 cash.

2. Prepare the journal entries to record transactions a and d of part 1.