Polar Company purchased a building with an expected useful life of 40 years for $600,000 on January 1, 2011. The building is expected to have a residual value of $40,000.
Required:
a. Give the journal entries that would be made by Polar to record the building purchase in 2011 and the depreciation expense for 2011 and 2012, assuming straight-line depreciation is used.
b. Repeat part "a," but now assume that double-declining-balance is used.