Concept #1: Ordinary Repairs vs. Capital Improvements

Practice: Categorize the following repairs on a truck as a Capital Expenditure or Ordinary Expense:

1. Major engine overhaul:

2. Oil change:

3. Replacement of windshield:

4. Modification of the body of the truck:

5. Addition to storage capacity of the truck:

6. Paint job:

Practice: Which of the following is not a capital expenditure?