What rig should report the gain as

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Reference no: EM132806558

Problem 1: Green Co. incurred leasehold improvement costs for its leased property. The estimated useful life of the improvements was 15 years. The remaining term of the nonrenewable lease was 20 years. These costs should be

A. Expensed as incurred.

B. Capitalized and depreciated over 20 years.

C. Capitalized and expensed in the year in which the lease expires.

D. Capitalized and depreciated over 15 years

Problem 2: Rig Co. sold its factory at a gain, and simultaneously leased it back for 10 years. The factory's remaining economic life is 20 years. The lease was reported appropriately as an operating lease. At the time of sale, Rig should report the gain as

A. A component of Other Comprehensive Income, net of income tax.

B. An asset valuation allowance.

C. A separate component of stockholders' equity.

D. Gain on sale, on the income statement

Reference no: EM132806558

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