Required information Problem 8-3A (Static) Asset cost allocation; straight-line depreciation LO C1, P1 [The following information applies to the questions displayed below] On January 1, Mitzu Company pays a lump-sum amount of $2,600,000 for land, Building 1, Building 2, and Land Improvements 1, Bullding 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 Cost of new Land Improvements 2, having a 20-year useful life and no salvage value $328,400 2,202,000 164,000 Problem 8-3A (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