On January 1, 2006, Powell Company purchased a building and machinery that have the following useful lives, salvage value, and costs.

Building, 25-year estimated useful life, $4,000,000 cost, $400,000 salvage value
Machinery, 10-year estimated useful life, $500,000 cost, no salvage value

A fleet of refrigerated delivery trucks is acquired on January 5, 2011, at a cost of $1,200,000 with an estimated useful life of eight years and an estimated salvage value of $100,000. Compute the depreciation expense for the first three years using the double-declining-balance method.

Kathy Company purchased and installed a machine on January 1, 2006 at a total cost of $72,000. Straight-line depreciation was calculated based on the assumption of a five-year life, and no salvage value. The machine was disposed of on July 1, 2009.

Prepare the general journal entry to update depreciation to July 1, 2009.
Prepare the general journal entry to record the disposal of the machine under each of these three independent situations:
The machine was sold for $22,000 cash.
The machine was sold for $15,000 cash.
The machine was totally destroyed in a fire and the insurance company settled the claim for $18,000 cash.

To determine the depreciation expense for the building, we need to subtract the salvage value from the initial cost and divide it by the useful life.

Building depreciation expense = (cost - salvage value) / useful life
Building depreciation expense = ($4,000,000 - $400,000) / 25 years
Building depreciation expense = $3,600,000 / 25 years
Building depreciation expense = $144,000 per year

For the machinery, since it has no salvage value, we can divide the cost by the useful life to find the annual depreciation expense.

Machinery depreciation expense = cost / useful life
Machinery depreciation expense = $500,000 / 10 years
Machinery depreciation expense = $50,000 per year

Therefore, the annual depreciation expense for the building is $144,000 and for the machinery is $50,000.

To calculate the annual depreciation expense for each asset, we need to use the straight-line depreciation method.

The formula to calculate annual depreciation expense is as follows:
Annual Depreciation Expense = (Cost - Salvage Value) / Useful Life

For the building:
Cost = $4,000,000
Salvage Value = $400,000
Useful Life = 25 years

Substituting the values into the formula, we get:
Annual Depreciation Expense for Building = ($4,000,000 - $400,000) / 25 years
= $3,600,000 / 25 years
= $144,000 per year

For the machinery:
Cost = $500,000
Salvage Value = No salvage value
Useful Life = 10 years

Substituting the values into the formula, we get:
Annual Depreciation Expense for Machinery = ($500,000 - $0) / 10 years
= $500,000 / 10 years
= $50,000 per year

Therefore, the annual depreciation expense for the building is $144,000, and the annual depreciation expense for the machinery is $50,000.