Problem $8-3$A $($Static$)$ Asset cost allocation; straight$-$line depreciation LO C$1,$ P$1$

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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 $1$ $ $328,400$

Cost of additional land grading $175,400$

Cost to construct Building $3,$ having a useful life of $25$ years and a $$392,000$ salvage value $2,202,000$

Cost of new Land Improvements $2,$ having a $20-$year useful life and no salvage value $164,000$

Problem $8-3$A $($Static$)$ Part $3$

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