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    Buildings: All costs incurred when acquiring, constructing, or bringing a building into the proper condition for its intended use are included in its historical cost. These costs also include any fees related to building permits, surveys, inspections and other legal, government or professional fees. 

    The cost to bring land into the proper condition for constructing a new building is typically considered a land cost. This may include the cost of tearing down an old building (less its salvage value). However, if the company previously owned and used the old building, the cost of tearing it down in order to re-construct it would simply be included in the calculation of a gain or loss recognized in the disposal of the old building (an asset previously on the balance sheet). 

    Leasehold improvements: The value of leasehold improvements typically revert to the owner at the end of the lease term. As a result, the proper treatement of improvements to leased property is to capitalize them in a seperate account named 'Leasehold Improvements' and to amortize them over their useful life or over the life of the lease, whichever is shorter. 

    Self-constructed assets: When a building is constructed by the company itself, the costs associated with its construction must be capitalized. The costs associated with direct labour and materials are easily allocated. However, the company must make a decision about allocating overhead costs, management time, and other indirect costs or burdens. 

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