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How would the Pittsburgh Steelers classify the purchase of robots to use for tackle practice? The Pittsburgh Steelers, a U.S. professional football team based in
How would the Pittsburgh Steelers classify the purchase of robots to use for tackle practice? The Pittsburgh Steelers, a U.S. professional football team based in Pennsylvania, are experimenting with using a robot, called a Mobile Virtual Player (MVP), during practices so that players do not have to tackle each other and risk injury. Instead, the players can tackle the foam-padded robot that mimics the sensation of tackling a person. The MVP robot is battery-operated and can move around the field for approximately 2 to 2.5 hours. the length of a regular practice. If the MVP robot runs continuously at its top speed of 18 miles per hour, it lasts about half an hour on a single charge. The MVP robots will be available through a limited release in the fall of 2016 with a full roll-out in January 2017. Pricing is not yet available. Questions 1. Assume that the Steelers decide to purchase several of these MVP robots. Would the organization expense or capitalize this purchase? Why? What if, after a year, routine maintenance needed to be performed on the MVP robots. For example, the foam padding might need to be replaced and the software updated. Would the Steelers expense or capitalize the cost of the routine maintenance? Why? 3. Assume now that the MVP robots are estimated by the manufacturer to last for five years. Now support that a team purchases a robot and definitely plans at the time of purchase to use it for three years only and then upgrade to the newest tackle robot model available at that future time. Will that team depreciate the original robot using a five year estimated useful life or a three year estimated useful life? Explain
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