Accountıng Iı Deneme Sınavı Sorusu #975638

Which of the following is true about capital expenditures?


They are debited to an asset account.

They decrease the asset’s capacity and efficiency.

They shorten the useful life of an asset. 

They are recognized as a period expense.

They are debited to Repairs and Maintenance Expense.


Yanıt Açıklaması:

A capital expenditure (balance sheet expenditure) is debited to an asset account because it increases the asset’s capacity or efficiency or extends the asset’s useful life. A capital expenditure is reported on the balance sheet as an asset. The correct answer is A.

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