Major repairs

Major repairs involve large expenditures that extend the useful life of an asset. For example, the replacement of a building roof is considered a major repair if it allows the building to be used beyond its normal operating life. Or, the engine in a forklift is replaced, thereby extending the lifespan of the equipment. In accounting, major repairs are capitalized as assets and depreciated over time.

Minor repairs do not extend the useful life of an asset, and so are charged to expense as incurred.