BioPharma Corp acquired a pharmaceutical research facility on 1 January 20X1 for $5,550,000 with an estimated residual value of $555,000 and an estimated useful life of 20 years. The company uses the straight-line depreciation method. Due to advancements in pharmaceutical technology, the company now forecasts the following net cash inflows: $860,000 on 31 December 20X5, $750,000 on 31 December 20X6, and $700,000 on 31 December 20X7. The present values of $1 at the end of each year, using a discount rate of 7%, are: 0.93 for year 1, 0.87 for year 2, and 0.81 for year 3. Required: Calculate the annual depreciation expense and the carrying amount of the research facility as of 31 December 20X5. Using the revised net cash inflows and present values, calculate the recoverable amount of the research facility.