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1. S corp acquires its only building on Jan 1, year 1, at a cost of $4,000,000. The building has a 10- year life, zero residual value, and is depreciated on a straight-line basis. The company adopts the revaluation model in accounting for buildings. On Dec 31, Year1, the fair value of the building is $3,780,000. On Dec 31, year 2, Fair value is $3,000,000. On Dec 31, year 3, Fair value is $3,200,000 and January 2, year 4, the company sells the building for $3,500,000. Required (1) Prepare all related entries from Year 1 to Year 4. (2) Determine the amounts to be reflected in the financial statements related to this building in the following table: Date Cost Jan 1, Y1 Dec 31, Y1 Dec 31, Y2 Dec 31, Y3 Jan 2, Y4 Accumulated Depreciation BV OCI Income R/E
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S CORP DATE 1jan ylBuilding A/c ACCOUNT TITLE DEBIT CREDIT 4,000,000 To Bank A/c 4,000,000 31dec yl Depreciation A/c 400,000 To Building A/c 400,000 1dec y1 Accumulated Depreciation A/c 400,000 To Depreciation A/c 400,000 31dec y1 Building A/c To OCI A/c 180,000 180,000 31dec y2 Depreciation A/c 420,000 To Building A/c 420,000 1dec y2 Accumulated Depreciation A/c 820,000 To Depreciation A/c 820,000 1dec y2 Profit And Loss A/c OCI A/c 180,000 180,000 To Building A/c 360,000 31dec y3Depreciation A/c 375,000 To Building A/c 375,000 1dec y3 Accumulated Depreciation A/c 1,195,000 To Depreciation A/ 1,195,000 31dec y3 Building A/c To OCI A/c 575,000 575,000 2jan y4 Bank A/c 3,500,000 To Building A/c To OCI A/c 3,200,000 300,000ATE COST ACCUMULATED DEPRICIATION BV INCOME OCI RVE jan1,Y1 4,000,000 Dec31,Y1 Dec31,Y2 Dec31,Y3 jan2,y4 0 4,000,000 400,000 3,780,000 820,000 3,000,000 1,195,0003,200,000 180,000180000 01-180000 575,000395,000 3,500,000275,000670,000

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