On January 1, 2019, Jerome Company signed a 12-year lease for a building. The entity has an option to renew the lease for an additional six-year period on or before January 1, 2023. During January 2022, the entity made substantial improvement to the building. The cost of the improvement was P4,500,000 with an estimated useful life of ten years. On December 31, 2022, the entity intended to exercise the renewal option. The entity has taken a full year depreciation on this improvement. On December 31, 2022, what is the carrying amount of the leasehold improvement? A. 4,500,000 В. 4,050,000 С. 4,200,000 D. 4,000,000

On January 1, 2019, Jerome Company signed a 12-year lease for a building. The entity has an option to renew the lease for an additional six-year period on or before January 1, 2023. During January 2022, the entity made substantial improvement to the building. The cost of the improvement was P4,500,000 with an estimated useful life of ten years. On December 31, 2022, the entity intended to exercise the renewal option. The entity has taken a full year depreciation on this improvement. On December 31, 2022, what is the carrying amount of the leasehold improvement? A. 4,500,000 В. 4,050,000 С. 4,200,000 D. 4,000,000

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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