Distinguishing between revenue expenditures and capital expenditures
Reliable Wrecker Service has just completed a minor repair on a tow truck. The repair cost was S620. and the book value prior to the repair was S5,600. In addition, the company spent $4,000 to replace the roof on a building. The new roof extended the life of the building by five years. Prior to the roof replacement, the general ledger reflected the Building account at $90,000 and related Accumulated Depreciation account at $26,500.
Required
After the work was completed, what book value should appear on the balance sheet for the tow truck and the building?
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