Fixed Assets

[E. Dantes]

Is new carpeting over an entire floor in a commercial building a leasehold improvement? Or furniture and fixture? What if the expected life of the carpet is shorter than the remainder of the lease term? How do you classify this asset and what useful life do you use?

 

[bklynboy]

I consider it a leasehold improvement since it becomes part of the property (you cant take it with you upon moving and isnt considered general maintenance). Useful ife is shorter of lease term (considering renewal options that are reasonably assured) or life of the improvement.

 

[mjcane]

Might be a BI instead of a TI.

Common area or leased space?

Leased space you use the life of the lease, common area you would use company policy for BI's.