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24 May, 06:44

A. Purchase price.

b. Ordinary recurring repairs to keep the machinery in good working order.

c. Lubrication before machinery is placed in service.

d. Periodic lubrication after machinery is placed in service.

e. Major overhaul to extend useful life by three years.

f. Sales tax paid on the purchase price.

g. Transportation and insurance while machinery is in transit from seller to buyer.

h. Installation.

i. Training of personnel for initial operation of the machinery.

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Answers (1)
  1. 24 May, 07:55
    0
    The answer would be

    Explanation:

    Consider the expenditures listed below and classify each of the expenditures as a capital expenditure or a revenue expenditure related to machinery.

    a. Purchase price: Capital expenditure.

    b. Ordinary recurring repairs to keep the machinery in good working order: Revenue expenditure.

    c. Lubrication before machinery is placed in service:Capital expenditure.

    d. Periodic lubrication after machinery is placed in service: Revenue expenditure.

    e. Major overhaul to extend useful life by three years: Capital expenditure.

    f. Sales tax paid on the purchase price: Capital expenditure.

    g. Transportation and insurance while machinery is in transit from seller to buyer: Capital expenditure.

    h. Installation: Capital expenditure.

    i. Training of personnel for initial operation of the machiner: Capital expenditure.
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