Tell whether each of the following transactions related to an office building is a revenue expenditure (RE)
Question:
Tell whether each of the following transactions related to an office building is a revenue expenditure (RE) or a capital expenditure (CE). In addition, indicate whether each transaction is an ordinary repair (OR), an extraordinary repair (ER), an addition (A), a betterments (B), or none of these (N).
1. The hallways and ceilings in the building are repainted at a cost of $6,250.
2. The hallways, which have tile floors, are carpeted at a cost of $28,000.
3. A new wing is added to the building at a cost of $105,470.
4. Furniture is purchased for the entrance to the building at a cost of $13,250.
5. The air-conditioning system is overhauled at a cost of $21,153. The overhaul extends the useful life of the air-conditioning system by 10 years.
6. A cleaning firm is paid $150 per week to clean the newly installed carpets.
Step by Step Answer:
Principles Of Financial Accounting
ISBN: 9780538755160
11th Edition
Authors: Belverd E Needles, Marian Powers