Land Purchased as a building site-cost include purchase price, commissions, title insurance, legal fees, accrued property taxes, surveying, clearing, landscaping, and local government assessments for streets, sewers. Land costs are not depreciated. Land Improvements Costs that increase the usefulness of the land. Examples include parking lot surfaces, driveways, fences, and lighting systems that have limited useful lives. If purchased- Cost usually include its purchase price, brokerage fees, taxes, title fees, attorney costs, and all expenditures to make it ready for its intended use.
Cost also includes design fees, building permits, and insurance during construction.
Machinery and Equipment Cost include all normal and necessary expenditures to purchase them and prepare them for their intended use. Individual asset cost determined by allocating the cost of the purchase among the different types of assets acquired based on their relative market values. The process of allocating to expense the cost of a plant asset to the accounting periods benefiting from its use. Recorded as a debit to Depreciation Expense and a credit to Accumulated Depreciation. Factors in computing depreciation Cost Salvage value Useful life Depreciation Methods Straight-line Method Charges the same amount to expense for each period of the asset's useful life.