How to treat long lived consumable that is essential to production, that is consumed over 18+ years but if extracted it would have lost at least 50% of value. Example; Original Cost $300K Once in the machine it becomes 18+ year asset If extracted it would only be worth 50% or $150K
Long Lived Consumable Asset
Answers
$300k / (machine production capacity per year x 18 years) = cost of asset per unit of production
Reduce asset by unit of production (eventually trickles to COGS)
Deal with loss of value when or if it happens. Value as reduced by actual production.
The only quirk I can think of (currently) is if the machine itself has a shorter useful life....if that is the case, use machine useful life.