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Reader Comments on ::   Subsequent costs
It was assumed that despite of major inspection the life of the asset has remained same at five years. Therefore, it appears reasonable to depreciate over the balance life of asset (3 years)and not beyond the expected life of asset.
Posted By: Sonam Wangdi      Posted on: 2018-05-15 11:57:13
Lets say there is an asset with a life of five years and say in the beginning of third year , a major inspection was carried out which may or may not necessarily increase the life of the asset but the inspection cost is added to the existing cost of the assets in the beginning of third year , so in this case assuming life of the asset has remained the same, so this additional cost will be depreciated over the balance life of the asset of three years or depreciated over five years from the date of addition being the life of the asset.
Posted By: Sonam Choeden      Posted on: 2018-05-15 11:57:13

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