Which of the Following Subsequent Expenditures Would Not Be Capitalized

question 133

Multiple Choice

Which of the following subsequent expenditures would not be capitalized?

• A)Ordinary repairs and maintenance.
• B)Additions.
• C)Improvements.

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Definitions:

Legal Entities

Organizations or structures recognized by law as capable of having rights and duties, such as corporations, partnerships, and trusts.

Parent Company

A company that has controlling interest in another company or companies, known as subsidiaries.

Subsidiary

A company that is controlled by another company, known as the parent company, through ownership of more than half of its voting stock.

Fixed Assets

Long-term tangible assets used in operation of a business that are unlikely to be converted into cash within a short period.