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Essay text:
The quality of the goods produced must be enhanced.
To explain further, there are four major types of expenditures that may be incurred after an asset has been acquired. These are classified as additions, improvements, rearrangements, or repairs.
Additions, such as adding on to an existing building or installing a fire alarm system, are capitalized since a new asset has been created and the useful life of the asset is now increased.
Improvements and replacements can result when a building is modified. Improvements are substitutions of a better asset for the one currently used, such as replacing a wood roof with a metal roof...
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