A building costing $ 6,000,000 was purchased on January 1, 2011. Based on management's best estimates, the useful life of the building was estimated to be 40 years with no residual value at that time. During 2017, it was discovered that the local government had plants to build a highway where the building stands. This project would require significant engineering and regulatory approval, so the site would be expropriated by January 1, 2023. The government agreed to pay $ 1,000,000 compensation for the building. The company uses the straight-line method to determine depreciation expenses. For each case, prepare the journal entries to record deprecation for 2011 and 2017.

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To record depreciation for the building in 2011 and 2017 we need to calculate the annual depreciatio... View the full answer