A company spends $10 million dollars for an office building. Over what period should the cost be written off?

Question

Quizplus · Accepted Answer

The cost of the office building should be written off over its useful life, which is typically 20-30 years for buildings. This allows for the depreciation expense to be spread out over a longer period of time and more accurately reflect the expensing of the asset. Choices A and D do not accurately reflect the appropriate depreciation method, and choice B would result in a large expense in the first year and potentially skew financial statements.

A Company Spends $10 Million Dollars for an Office Building