On March 31, 2024, Susquehanna Insurance purchased an office building for $12,000,000. Based on their relative fair values, one-third of the purchase price was allocated to the land and two-thirds to the building. Furniture and fixtures were purchased separately from office equipment on the same date for $1,200,000 and $700,000, respectively. The company uses the straight-line method to depreciate its buildings and the double-declining-balance method to depreciate all other depreciable assets. The estimated useful lives and residual values of these assets are as follows:

Required:
1. Calculate depreciation for the years ended December 31, 2024 and 2025.
2. What book values would be reported in the December 31, 2025, balance sheet (including land)?

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Building Furniture and fixtures Office equipment Service Life 30 10 5 Residual Value 10% of cost 10% of cost $30,000