During the current year, Moordale Company replaced a portion of its building for 2,000,000. Before the replacement, the building and accumulated depreciation accounts were: Building (original life, 25 years) = 7,200,000 Accumulated Depreciation (5 years expired) = 1,440,000 It was determined that the portion of the building being replaced had an original cost of 1,600,000.

1. What is the entry to record the retirement of the building? 2. What is the entry to record the replacement of the building?

3. What amount of depreciation expense should be recognized at the end of the current year?