Crestfield leases office space. On January 3, the company incurs $28,000 to improve the leased office space. These improvements are expected to yield benefits for 4 years. Crestfield has 2 years remaining on its lease. What journal entry would be needed to record the expense for the first year related to the improvements?
A. Debit Depletion Expense $28,000; credit Accumulated Depletion $28,000.
B. Debit Depletion Expense $14,000; credit Accumulated Depletion $14,000.
C. Debit Amortization Expense $7000; credit Accumulated Amortization-Leasehold Improvements $7000.
D. Debit Depreciation Expense $7000; credit Accumulated Depreciation $7000.
E. Debit Amortization Expense $14,000; credit Accumulated Amortization-Leasehold Improvements $14,000.
Answer: E
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