Formula Results signed a 10-year lease for a store in the best mall in the area.At the beginning of the seventh year of the lease,the company decided to refurbish the store.The following expenditures were made:
$$\begin{array} { l l l }
\text { Item } & \underline { \text { Cost } } & \underline { \text { Useful } } \text { Life } \
\text { Carpeting } & \$ 6,000 & 3 \text { years } \
\text { Lighting Fixtures } & \$ 4,500 & 6 \text { years } \
\text { Wall Construction } & \$ 10,000 & \text { 8years }
\end{array}$$ All items were paid in cash.There is no residual value for any of the items noted above.
a.Prepare the journal entry to record the expenditures of the above items.
b.Prepare the year-end adjustment to record the expense associated with the above items.

Question

Formula Results signed a 10-year lease for a store in the best mall in the area.At the beginning of the seventh year of the lease,the company decided to refurbish the store.The following expenditures were made:
 $$\begin{array} { l l l } 
\text { Item } & \underline { \text { Cost } } & \underline { \text { Useful } } \text { Life } \
\text { Carpeting } & \$ 6,000 & 3 \text { years } \
\text { Lighting Fixtures } & \$ 4,500 & 6 \text { years } \
\text { Wall Construction } & \$ 10,000 & \text { 8years }
\end{array}$$ All items were paid in cash.There is no residual value for any of the items noted above.
a.Prepare the journal entry to record the expenditures of the above items.
b.Prepare the year-end adjustment to record the expense associated with the above items.

Quizplus · Accepted Answer

The Answer of Formula Results signed a 10-year lease for a store in the best mall in the area.At the beginning of the seventh year of the lease,the company decided to refurbish the store.The following expenditures were made:
 $$\begin{array} { l l l } 
\text { Item } & \underline { \text { Cost } } & \underline { \text { Useful } } \text { Life } \
\text { Carpeting } & \$ 6,000 & 3 \text { years } \
\text { Lighting Fixtures } & \$ 4,500 & 6 \text { years } \
\text { Wall Construction } & \$ 10,000 & \text { 8years }
\end{array}$$ All items were paid in cash.There is no residual value for any of the items noted above.
a.Prepare the journal entry to record the expenditures of the above items.
b.Prepare the year-end adjustment to record the expense associated with the above items.

Formula Results Signed a 10-Year Lease for a Store in the Best