PROBLEM 1: Sale of Asset. (8 points)

On January 1, 2015, Lowes Corporation purchased a storage building for $200,000. It depreciated the building using the straight-line method assuming nine-year useful life and a $20,000 salvage value. On March 1, 2020, Lowes sold that building for $86,000 cash. Lowes records depreciation expense to the nearest month.

Required:

1. Prepare the March 1, 2020, journal entry to record the depreciation expense for 2020.
2. Prepare the March 1, 2020, journal entry to record the sale of the building.