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On January $1,$ Mitzu Company pays a lump$-$sum amount of $$2,600,000$ for land, Building $1,$ Building $2,$ and Land Improvements $1.$ Building $1$ has no value and will be demolished. Building $2$ will be an office and is appraised at $$644,000,$ with a useful life of $20$ years and a $$60,000$ salvage value. Land Improvements $1$ is valued at $$420,000$ and is expected to last another $12$ years with no salvage value. The land is valued at $$1,736,000.$ The company also incurs the following additional costs.

Cost to demolish Building $1$

Cost of additional land grading

Cost to construct Building $3,$ having a useful life of $25$ years and a $$392,000$ salvage value

$$328,400$

Cost of new Land Improvements $2,$ having a $20-$year useful life and no salvage value

$175,400$

$2,202,000$

$164,000$

$3.$ Using the straight$-$line method, prepare the December $31$ adjusting entries to record depreciation for the first year these assets were in use.

Journal entry worksheet

$1$

$2$

$3$

$4$

Record the year$-$end adjusting entry for the depreciation expense of Building

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Journal entry worksheet

$1$

$2$

$3$

$4$

Record the year$-$end adjusting entry for the depreciation expense of Building $2.$

Note: Enter debits before credits.

$\backslash$table$[[$Date$,$General Journal,Debit,Credit$],[$December $31,,,],[x,$grad,,$],[-,3.,-,],[5,$x$,,],[,1,,],[,,,]]$

Journal entry worksheet

$13$

$4$

Record the year$-$end adjusting entry for the depreciation expense of Building

$3.$

Note: Enter debits before credits.

$\backslash$table$[[$Date$,$General Journal,Debit,Credit$],[$December $31,,,],[,,,],[,,,],[,,,],[,,,],[,,,]]$

Journal entry worksheet

$1$

$2$

$3$m

$4$

Record the year$-$end adjusting entry for the depreciation expense of Land Improvements $1.$

Note: Enter debits before credits.

$\backslash$table$[[$Date$,$General Journal,Debit,Credit$],[$December $31,,,],[,,,],[,,,],[,,,],[,,,]]$

$$

$$

C

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$6$

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Using the straight$-$line method, prepare the December $31$ adjusting entries to record depreciation for th in use.

Journal entry worksheet

$1$

$2$

$3$

$$

Record the year$-$end adjusting entry for the depreciation expense of Land Improvements $2.$

Note: Enter debits before credits.

$\backslash$table$[[$Date$,$General Journal,Debit,Credit$],[$December $31,,,],[,,,],[,,,],[,,,],[,,,]]$

$$

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