Kling Company was organized in late 2010 and began operations on January 2, 2011. Prior to the start of operations, it incurred the following costs:
Costs of hiring new employees .................... $ 3,000Attorney's fees in connection with the organization of the company ..... 12,000Improvements to leased offices prior to occupancy (10-year lease) ..... 6,000Costs of pre-opening advertising ...................... 5,000
Required:
What amount should the company expense in 2010? In 2011?