Intermediate Accounting
1st Edition
ISBN: 9780132162302
Author: Elizabeth A. Gordon, Jana S. Raedy, Alexander J. Sannella
Publisher: PEARSON
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Chapter 11, Problem 11.21BE
Leasehold Improvements. At the beginning of its fiscal year Beau Co. leased office space for a 20-year period. Prior to occupying the office, Beau needed to make renovations costing $750,000 with an expected useful life of 15 years. The renovations are to be recorded as leasehold improvements. Assuming that Beau uses the straight-line method, prepare the
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Inc. currently leases an office building. It initiated the original 23-year lease 17 years ago, so 6 years remain on the lease. On January 1, PP paid $28,500 to install a new heating and cooling system with a 12-year estimated useful life that it expects to use ratably over the remaining term of the lease. What is the journal entry to record the expenditure? How much amortization will PP report and for how many years? What is the journal entry for the first year?
On January 1,2022, Uranus Company leased land and building from an unrelated lessor for a 10 - year term. The lease has a renewal option for an additional 10 years, but Uranus has hot reached a decision with regard to the renewal option. In early January of 2023, Uranus completed the following improvements to the property:Description Estimated Life CostParking lot 5 years P 900,000Warehouse 15 years 1,620,000Sales office 10 years 360,000How much should be the depreciation of leasehold Improvements for 2023?
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b. capitalized as leasehold improvements and depreciated over fifteen years.
c. capitalized as leasehold improvements and depreciated over ten years.
d. expensed as incurred.
Chapter 11 Solutions
Intermediate Accounting
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