Every Three Years a Major Component (Part #45)in a Machine

question 22

Essay

Every three years a major component (part #45)in a machine must be replaced. By doing this regular but expensive repair the machine can be used for 15 years. If Part #45 were not replaced, the machine could be used only for a maximum of six years. When the machine was originally purchased for $5,000,000 it was set up as one asset and depreciated over its estimated useful life of 15 years. Recently this repair was completed at a cost of $700,000 for Part #45. The earlier Part #45 cost $550,000 when it was installed three years ago. Neither the old nor the new Part #45 has any residual value.
Prepare the necessary journal entry to record the transaction. Provide a short justification for your chosen treatment.

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Definitions:

Disparities

Differences or inequalities that are often found between segments of the population, such as health, wealth, or opportunities.

Cultural Competence

Process in which the health care professional continually strives to achieve the ability and availability to work effectively with individuals, families, and communities.

Multicultural Context

A setting or situation that involves the presence and interaction of people from diverse cultural backgrounds.

Rapport

A positive relationship characterized by mutual respect, trust, and understanding between two or more parties.