A company spends $20 million 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 determined by the company's accounting policy and could range from 10 to 40 years. This method of depreciation allows for the cost to be spread out over the period of time that the building is generating revenue for the company. Options A, B, and D are not appropriate as they do not adhere to generally accepted accounting principles for the treatment of long-term assets.

A Company Spends $20 Million for an Office Building