Phoenix Agency leases office space. On January 3, Phoenix incurs $78,000 to improve the leased office...
Phoenix Agency leases office space. On January 3, Phoenix incurs $78,000 to improve the leased office space. These improvements are expected to yield benefits for 8 years. Phoenix has 6 years remaining on its lease. Compute the amount of expense that should be recorded the first year related to the improvements.
Multiple Choice $9,750.
$20,500.
$17,250.
$13,000.
$7,500.
Homework Answers
Amortization expenses
= Cost of improvement / Lower of 8 or 6
= 78,000 / 6
= 13,000
Option C is the answer
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