At January 1, 2018, Hammersmith Limited reported the following property, plant, and equipment accounts:

Accumulated depreciation-buildings.....................$24,200,000

Accumulated depreciation-equipment.....................30,000,000

Buildings....................................................................57,000,000

Equipment..................................................................96,000,000

Land.............................................................................8,000,000

The company uses straight-line depreciation for buildings and equipment, its year end is December 31, and it makes adjusting entries annually. The buildings are estimated to have a 40-year life and no residual value; the equipment is estimated to have a 10-year useful life and no residual value.

During 2018, the following selected transactions occurred:

Apr. 1 Purchased land for $3.8 million. Paid $950,000 cash and issued a 10-year, 6% mortgage payable for the balance. Interest is payable at maturity.

May 1 Sold equipment for $700,000 cash. The equipment cost $1.5 million when it was originally purchased on January 1, 2014.

June 1 Sold land for $2.4 million. Received $760,000 cash and accepted a 6% note for the balance. The note is due at maturity. The land cost $600,000 when purchased on June 1, 2008.

July 1 Purchased equipment for $2 million on account, terms n/60.

Sept. 2 Paid amount owing on account for purchase of equipment on July 1.

Dec. 31 Retired equipment that cost $940,000 when purchased on January 1, 2009. No proceeds were received.

31 Tested land for impairment and found that its recoverable value was $11 million.

Instructions

(a) Record the above transactions.

(b) Record any adjusting entries required at December 31.

(c) Prepare the property, plant, and equipment section of the company's statement of financial position at December 31.