Phoenix Agency leases office space for $6,800 per month. On January 3, Phoenix incurs $98,400 to improve the leased office space. These improvements are expected to yield benefits for 10 years. Phoenix has 8 years remaining on its lease. Compute the amount of expense that should be recorded the first year related to the improvements.

Multiple Choice

• $16,640.

• $9,840.

• $12,300.

• $6,800.

• $19,100.