For each of the following situations, discuss whether the expense is currently deductible or must be capitalized:

Question:

For each of the following situations, discuss whether the expense is currently deductible or must be capitalized:
a. The Mickleham Hotel installs a $125,000 sprinkler system to comply with recently enacted fire regulations.
b. The Healesville pays a real estate commission of $35,000 in acquiring its new office building.
c. The Doverson Company pays $25,000 to repave its parking lot.
d. The Watsonia Company pays $56,000 to add an air-conditioning system to its warehouse. The company had agreed to air condition the warehouse as part of a three-year labor agreement with its employees.
e. Hua pays $600 to repair the walls and ceiling of his rental property after his tenant moves out.

Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...