Title: Plant Fund | Financial Services & Operations | Michigan Tech
Headings: Plant Fund
Plant Fund
Plant Fund Definition
Capitalization of Plant Fund Assets Definition
Componentization
Capitalization Guidelines
New Construction
Purchase of Existing Buildings
Building Improvements
Site Work
Utilities
Land
Equipment
Capital Leases
Property Trade-In
Gifts
Library Books
Mineral Specimens

Content: Buildings and other construction are first accounted for as construction in progress. When the construction is at least 90% complete or the construction has been certified  as substantially complete, the construction is removed from construction in progress  and accounted for as buildings or other. Purchase of Existing Buildings
Capitalize the purchase price plus acquisition costs. The fair market value of the  land should be recorded as such and the value of the building should be the difference  between the total cost less the amount capitalized as land. Building Improvements
Building improvements are significant alterations, renovations, or structural changes  that meet or exceed $50,000 and increase the usefulness of the building, enhance its  efficiency, or prolong its useful life. Building improvements may include interior or exterior construction of a building  or building systems, such as electrical or plumbing systems. They may also include  the completion of interior or exterior appointments or finishes, so long as they are  done as part of a significant alteration or renovation. Capital Improvements
Categories of building improvements include alterations, renovations, and betterment. Alterations - A change in the internal arrangement or other physical characteristics  of an existing asset so that it may be effectively used for a newly designated purpose. Renovations - The total or partial upgrading of a facility to higher standards of  quality or efficiency than originally existed.