Comments (3)

Mar 9, 2008

I would assume that "maintenance expense" would be the account name. As all expenses, it would be a temporary account, closed out to the income statement at the end of period, and would affect the cash flow statement through a change in net income.

Mar 9, 2008

It depends what the car is being used for.

If it's for inventory, the expense would be added to the inventory, so everything would affect the balance sheet and the CS if you used cash to purchase it.

If it's for indirect capital spending, the expense would have to depend on how big the expense is. If it totally revolutionizes the car, the expense would be added to the overall CAPX account in the B/S. If it's a minor repair, it would be added as a operating(?) expense on the I/S.

And if it's unrelated to the company, it wouldn't be on any sheet.

Mar 9, 2008