On January 1, 2023, Creative Calligraphy Inc. purchased land, building, equipment, and tools for a total of $2,520,000. An appraisal identified the fair values to be $700,000 (land), $1,120,000 (building), $210,000 (equipment), and $70,000 (tools). The estimated useful life and residual value of the building was 10 years and $700,000; for the equipment, five years and $42,000; and for the tools, three years and $7,000. Calculate depreciation for 2023 and 2024 using the double-declining-balance method. Creative Calligraphy’s year-end is December 31.

Analysis Component:

Explain depreciation as it applies to land.