CamCo Ltd. leased floor space in a new office building. Rent will cost $10,000 per month...

 

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CamCo Ltd. leased floor space in a new office building. Rent will cost $10,000 per month for a ten-year iease, but some renovations are needed and will be pald by CamCo to customize the space. The renovations include installing wals to create a new office and boardroom (cost $8,000), new flooring (cost $5,800), painting (cost $1,500) and updated wiring to accommodate computer servers (cost $8,700). How should these costs be handled for accounting purposes by CamCo? Multiple Choice They should be capitalized as development costs Painting costs should be capitalized to leasehold improvements and other costs should be charged to rent expense They should oll be capitalized as leaseholid improvements Painting costs should be charged to rent expense and the other costs should be capitalized to leasehold improvements CamCo Ltd. leased floor space in a new office building. Rent will cost $10,000 per month for a ten-year iease, but some renovations are needed and will be pald by CamCo to customize the space. The renovations include installing wals to create a new office and boardroom (cost $8,000), new flooring (cost $5,800), painting (cost $1,500) and updated wiring to accommodate computer servers (cost $8,700). How should these costs be handled for accounting purposes by CamCo? Multiple Choice They should be capitalized as development costs Painting costs should be capitalized to leasehold improvements and other costs should be charged to rent expense They should oll be capitalized as leaseholid improvements Painting costs should be charged to rent expense and the other costs should be capitalized to leasehold improvements

Answer rating: 100% (QA)

The correct answer for the question is Option C They should all be capitalized as leasehold improvem... View the full answer