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On January 1, 20x1, DIMINUTIVE SMALL Co. signed a ten-year lease for office space. DIMINUTIVE...

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Accounting

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On January 1, 20x1, DIMINUTIVE SMALL Co. signed a ten-year lease for office space. DIMINUTIVE has the option to renew the lease for an additional five-year period on or before January 1, 2x10. During the first half of January 20x2, DIMINUTIVE Co. Incurred the following costs: P3,600,000 for general Improvements, with an estimated useful life of ten years, on the leased premises. $400,000 for office furniture with an estimated useful life of ten years. P800,000 for movable assembly line equipment with a useful life of 5 years. At the time the leasehold Improvements were finished, DIMINUTIVE Co. was uncertain as to the exercise of the lease renewal option. How much is the depreciation expense on the leasehold Improvements in 20x2? *

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