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Today a firm treated the cash spent on updating a piece of equipment as a Capitalized Addition (not as a regular repairs and maintenance activity).

Today a firm treated the cash spent on updating a piece of equipment as a Capitalized Addition (not as a regular repairs and maintenance activity). What effect does this transaction have?

  1. Lowers Total Assets today
  2. Lowers Depreciation expense today
  3. Increases Total Liabilities in the future
  4. Increases Depreciation expense in the future
  5. Increases Cash from Investing today

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