Title: Land improvements depreciation | WIKIACCOUNTING
Headings: Land improvements depreciation
Land improvements depreciation
What is the land improvement?
Accounting treatment
Depreciation
Conclusion

Content: When companies purchase land, it may come with a building on it. Therefore, they need to allocate the cost between the land and building. It is so they can depreciate only the building element and not the land itself. Sometimes, however, companies may also perform some land improvements, which can be depreciable. What is the land improvement? Land improvement refers to enhancements made to a plot of land to make it more usable. Usually, these improvements have a useful life and, therefore, are depreciable. However, if a land improvement does not have a useful life or companies cannot estimate it, then the company cannot depreciate the improvement. Similarly, there are some costs that qualify as land improvements and some which do not. For companies to consider expenditure on land as improvement, they must meet several requirements.