Depreciation and Useful Life

The University depreciates assets on a straight-line basis over their estimated useful lives as follows:

Asset Type Descriptions

• Land – Any improved or unimproved tract owned by Kentucky State University. Land is not depreciated. If the land is purchased for the purpose of constructing a building, all costs incurred up to the excavation for the new building should be included in land costs. If the land is acquired by gift or bequest, its cost should be recorded at fair value at the date of the gift or bequest. Acquisition costs that should be capitalized as land include:
• Land improvement – Any non-building improvement built, installed, or established to make land ready, enhance the quality of, or facilitate the use of the land for its intended purpose. Work to maintain land improvements in its existing condition should be expensed. Improvements include:
• Building – A structure that is permanently attached to the land with a foundation, has a roof, is partially or completely enclosed by four walls, has one utility other than electricity, and is not transportable or moveable, and is used for housing people, animals, plants, or equipment.
• oDemolition, grading, site improvement, landscaping
• oPurchase price including closing costs, title searches, title insurance, broker's fees
• oAppraisal fees
• oOther professional services such as legal fees
• oExcavation
• oDriveways, sidewalks, parking lots
• oAthletic fields
• oFlagpoles, retaining walls, fencing, outdoor lighting
• oCosts to include in the purchase of a building:
• Purchase price including closing costs, title searches, title insurance, broker's fees
• Appraisal fees