Final answer:
Under the modified approach, the depreciation charge would be $4 million every four years. Under the standard approach, the depreciation charge would be $800,000 per year.
Step-by-step explanation:
Under the modified approach to accounting for infrastructure, depreciation charges are based on the cost of preserving the asset at a specific condition level. In this case, the government repaves the section of highway every four years at a cost of $4 million to preserve it at a specific condition level.
Therefore, the depreciation charge under the modified approach would be $4 million every four years.
On the other hand, under the standard approach, depreciation charges are based on the initial cost of the asset and its estimated useful life. If the asset is valued at $3.2 million and the government repaves it every four years, the estimated useful life of the asset would also be four years. The depreciation charge under the standard approach would be $3.2 million divided by four, which is $800,000 per year.