Question $24$

Following a merger and consolidation of offices, a national,

publicly traded stock brokerage firm successfully enters in

to a sublease $($as sub$-$lessor$)$ on a facility that is no longer

needed for their operations. Both the lease and the sublease

terminate in three years. Although the user is pleased to

have successfully consolidated the offices, there is a rent

shortfall $($loss$)$ as a result of the sublease each of the three

years of the lease: $$80,000$ in Yedr $1,$ $$95,000$ in Year $2,$ and

$$115,000$ in Year $3.$

For financial reporting purposes, the user will:

Report the rent plus the $$80,000$ difference as an occupancy

expense in Year $1$

Report the rent minus the $$80,000$ difference as an occupancy

expense in Year $1$

occupancy expense in Year $1$