On January 1, 201, Powell Company purchased a building and machinery that have the following useful lives, residual value, and costs.

Building, 25-year estimated useful life, $4,000,000 cost, $400,000 residual value Machinery, 10-year estimated useful life, $500,000 cost, no residual value

The building has been depreciated under the straight-line method through 205. In 206, the company decided to switch to the double-declining balance method of depreciation for the building. Powell also decided to change the total useful life of the machinery to 8 years, with a residual value of $25,000 at the end of that time. The machinery is depreciated using the straight-line method.

Instructions

1. Prepare the journal entry necessary to record the depreciation expense on the building in 206.
2. Compute depreciation expense on the machinery for 206.