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  1. business
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  3. at the beginning of its fiscal year, lakeside inc.

At the beginning of its fiscal year, Lakeside Inc. leased office space to LTT Corporation...

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Accounting

At the beginning of its fiscal year, Lakeside Inc. leased office space to LTT Corporation under a twelfth-year operating lease agreement. The contract calls for quarterly rent payments of $35,000 each. The office building was acquired by Lakeside at a cost of $3.0 million and was expected to have a useful life of 30 years with no residual value. What will be the effect of the lease on LTTs earnings for the first year (ignore taxes)?

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reduces its earnings by $35,000 LTT

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