Sherry Miller, ARNP is a medicare enrolled Nurse Practitioner - Family in Mason City, Iowa. She graduated from nursing school in 2015 and has 3 years of diverse experience with area of expertise as Nurse Practitioner.
Major repairs to production equipment should be capitalized. The repair to the asset will extend the useful life of the piece of equipment, which is an allowable reason to capitalize an expense. Companies should be careful, however, to not capitalize the maintenance cost of a piece of equipment.
If a major component of the asset must be replaced, the cost can be capitalized. In contrast, replacement costs for small components such as wear parts go to expenses. Costs of repair and maintenance of an asset to its original condition are considered an expense.