When purchasing a new piece of equipment, how should the replacement item be handled?

The correct approach when purchasing a new piece of equipment is to program it into the long-range capital improvement plan. This method ensures that the acquisition is systematically organized and accounted for, aligning with the overall strategic goals and resource planning of the organization. Long-range planning allows for better budgeting, which can help prioritize funding and manage resources effectively over an extended period.

Incorporating new equipment into this plan facilitates a structured evaluation of the needs of the organization, assisting in determining when and how to phase in replacement items. It also aids in forecasting future equipment needs, ensuring that financial resources are allocated appropriately and that there is minimal disruption in operations due to unexpected equipment failures or the need for replacements.

Other options lack this comprehensive approach. Ignoring the replacement until it is needed creates risk and can lead to inefficient emergency procurement when equipment fails. Budget inclusion is necessary but does not provide the broader strategic framework of a long-range plan. Selling as surplus addresses removal of old equipment but not the systemic process of planning for replacements and upgrades.