The correct answer is "capitalized; expensed".

Here's why:

1. The cost of a major improvement that extends the useful life of an asset would be capitalized. This is because capitalization is the recording of a cost as an asset, rather than an expense. This is done when the asset is expected to generate economic benefits over a longer period of time, not just within the current year. So, if a major improvement extends the useful life of an asset, the cost of this improvement is capitalized.

2. The cost of maintenance that does not increase the future benefits would be expensed. This is because expenses are costs that do not provide future economic benefits or whose future economic benefits cannot be measured. So, if the maintenance does not increase the future benefits of the asset, the cost of this maintenance is considered an expense.

Question

The correct answer is "capitalized; expensed".

Here's why:

1. The cost of a major improvement that extends the useful life of an asset would be capitalized. This is because capitalization is the recording of a cost as an asset, rather than an expense. This is done when the asset is expected to generate economic benefits over a longer period of time, not just within the current year. So, if a major improvement extends the useful life of an asset, the cost of this improvement is capitalized.

2. The cost of maintenance that does not increase the future benefits would be expensed. This is because expenses are costs that do not provide future economic benefits or whose future economic benefits cannot be measured. So, if the maintenance does not increase the future benefits of the asset, the cost of this maintenance is considered an expense.

Knowee AI · Accepted Answer

The correct answer is "capitalized; expensed".

Here's why:

1. The cost of a major improvement that extends the useful life of an asset would be capitalized. This is because capitalization is the recording of a cost as an asset, rather than an expense. This is done when the asset is expected to generate economic benefits over a longer period of time, not just within the current year. So, if a major improvement extends the useful life of an asset, the cost of this improvement is capitalized.

2. The cost of maintenance that does not increase the future benefits would be expensed. This is because expenses are costs that do not provide future economic benefits or whose future economic benefits cannot be measured. So, if the maintenance does not increase the future benefits of the asset, the cost of this maintenance is considered an expense.

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