Phoenix Agency leases office space for $7100 per month. On January 3, Phoenix incurs $88,200 to improve the leased office space. These improvements are expected to yield benefits for 9 years. Phoenix has 7 years remaining on its lease. Compute the amount of expense that should be recorded the first year related to the improvements.
A. $7100.
B. $12,600.
C. $19,700.
D. $9800.
E. $16,900.
Answer: B
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