Property and Equipment

Property and equipment is recorded at cost, including interest paid on funds borrowed to pay for the construction of major capital additions.

Property and equipment are depreciated over estimated useful lives, which range from 3 to 40 years, except for buildings with historic status, which are depreciated over 75 years, using the straight-line method.

The depreciation and amortization of capital assets over the estimated useful lives, and the determination of salvage value, requires management to make judgments about future events. Because capital assets are utilized over relatively long periods of time, periodic evaluations of whether adjustments to the estimated service lives or salvage values are necessary to insure these estimates properly match the economic use of the asset. These evaluations may result in changes to the estimated lives and residual values. These estimates affect the amount of depreciation expense recognized in a period and, ultimately, the gain or loss on disposal of the asset. Changes in the estimated lives of assets will result in an increase or decrease in the amount of depreciation and amortization recognized in future periods.