The Village of Canandaigua determined that,as of July 1,2013,infrastructure assets estimated at $300 million were in place,with an estimated useful life of 25 years.During the year ended June 30,2014,expenditures were $7 million for the routine maintenance of infrastructure,$3 million to extend the life of existing infrastructure,and $12 million for infrastructure additions and improvements.
Required:
a)If the modified approach is used,what would be the amount charged to expense during the fiscal year ended June 30,2014.What amount would be capitalized?
b)What amount would have been charged to expense if the modified approach were not used?
What amount would be capitalized?

Question

The Village of Canandaigua determined that,as of July 1,2013,infrastructure assets estimated at $300 million were in place,with an estimated useful life of 25 years.During the year ended June 30,2014,expenditures were $7 million for the routine maintenance of infrastructure,$3 million to extend the life of existing infrastructure,and $12 million for infrastructure additions and improvements.
Required:
a)If the modified approach is used,what would be the amount charged to expense during the fiscal year ended June 30,2014.What amount would be capitalized?
b)What amount would have been charged to expense if the modified approach were not used?
 What amount would be capitalized?

Quizplus · Accepted Answer

The Answer of The Village of Canandaigua determined that,as of July 1,2013,infrastructure assets estimated at $300 million were in place,with an estimated useful life of 25 years.During the year ended June 30,2014,expenditures were $7 million for the routine maintenance of infrastructure,$3 million to extend the life of existing infrastructure,and $12 million for infrastructure additions and improvements.
Required:
a)If the modified approach is used,what would be the amount charged to expense during the fiscal year ended June 30,2014.What amount would be capitalized?
b)What amount would have been charged to expense if the modified approach were not used?
 What amount would be capitalized?

The Village of Canandaigua Determined That,as of July 1,2013,infrastructure Assets