Problem
Peoples Corporation purchased a building on December? 29, 2012 that cost? $1,000,000 and occupied it on January? 2, 2013. The owner estimated that the building would last 40 years with a salvage value of? $100,000 using? straight-line depreciation. In early? 2016, Mr. Peoples learned that due to a permanent highway? closure, the company needs to relocate at the end of 2018. He believes that the salvage value at that time will be? $700,000. Compute the amount of depreciation to record during? 2016, and each of the two years thereafter.