LAC Co. is a public company that decides to discontinue its operations on June 1, 2020. The building of the discontinued operations was purchased on January 1, 2016 for $700,000. The annual depreciation is $37,500. The fair value of the building on June 1, 2020 was $566,000. The costs to sell were $10,000. In addition, the following information was provided for the 2020 year:
• Sales (including $120,000 generated by discontinued operations) was equal to $600,000
• Expenses (including $132,000 generated by discontinued operations before recording depreciation and impairment loss) was equal to $330,000

(1) Prepare the journal entries to record the depreciation for the building and its reclassification as held for sale in 2020. Assume value in use is lower than net realizable value.
(2) Prepare a revised statement of income for the year ended December 31, 2020 in good form, assuming the tax rate is 25%.