Peoples Corporation Purchased a Building on December 29, 2014 That

Multiple Choice

Peoples Corporation purchased a building on December 29, 2014 that cost $1,400,000 and occupied it on January 2, 2015. The owner estimated that the building would last 40 years with a salvage value of $150,000 using straight-line depreciation. In early 2018, Mr. Peoples learned that due to a permanent highway closure, the company needs to relocate at the end of 2020. He believes that the salvage value of the building at that time will be $800,000. Compute the amount of depreciation to record during 2018, and each of the two years thereafter. (Round your final answer to the nearest dollar.)

A) $31,250
B) $200,000
C) $168,750
D) $150,000