aubrey seagars owns and operates diamond transport co during the past year aubrey in 549789

EX 10-5 Capital and revenue expenditures

Aubrey Seagars owns and operates Diamond Transport Co. During the past year, Aubrey incurred the following costs related to an 18-wheel truck:

1. Installed a television in the sleeping compartment of the truck.

2. Replaced the old radar detector with a newer model that is fastened to the truck with a locking device that prevents its removal.

3. Installed a wind deflector on top of the cab to increase fuel mileage.

4. Modified the factory-installed turbo charger with a special-order kit designed to add 50 more horsepower to the engine performance.

5. Replaced a headlight that had burned out.

6. Replaced the hydraulic brake system that had begun to fail during his latest trip through the Rocky Mountains.

7. Changed engine oil.

8. Replaced a shock absorber that had worn out.

9. Replaced fog and cab light bulbs.

10. Removed the old CB radio and replaced it with a newer model with a greater range.

Classify each of the costs as a capital expenditure or a revenue expenditure.