On January 1, 2018, Claude paid the annual rental for 2018 and 2019 including the security deposit (non-refundable). In addition to annual rental and real property taxes, part of the lease was for Claude to improve the facility. The improvement was completed on January 1, 2020. Details of the improvements were as follows: Cost of leasehold improvement - 6,000,000 Estimated useful life of improvement - 15 years

On January 1, 2018, Claude paid the annual rental for 2018 and 2019 including the security deposit (non-refundable). In addition to annual rental and real property taxes, part of the lease was for Claude to improve the facility. The improvement was completed on January 1, 2020. Details of the improvements were as follows: Cost of leasehold improvement - 6,000,000 Estimated useful life of improvement - 15 years

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On January 4, 2022, James Nook, Inc. signed a 10-year nonrenewable lease for a building to be used in its manufacturing operations. During January 2022, James Nook incurred the following costs:- P 76,800 for general improvements to the leased premised with an estimated useful life of eight years.- P 32,000 for a movable assembly line equipment installation with an estimated useful life of eight years.A full year's amortization is taken for the calendar year 2022.What amount should James Nook record as amortization of leasehold improvements in 2022?P 10,880P 13,600P 9,600P 7,680
WHAT IS THE AMOUNT OF DEPRECIATION IN THE PROBLEM?
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