What are the Effects of any addition or extension to the Existing Assets?

An existing assets may require some additions or extensions for being suitable for operations. Such additions/ extensions may or may not become an integral part of the asset. The amount incurred on such additions/extensions is capitalized and written off as depreciation over the life of the asset. It is important to mention here the amount so incurred is in addition to usual repair and maintenance expenses. As-6 Mentions that

• Any addition or extension, which becomes an integral part of the existing assets should be depreciated over the useful life of the existing assets
• The depreciation on such addition or extension may also be provided at the rate to the existing assets;
• Where an addition or extension retains a separate identity and is capable of being used after the existing assets is disposed off, depreciation, should be provided independently on basis of its own useful life.