The first merge combines the two lowest counts.
Pick the smallest two
Each merge takes the two lowest-count items. Ties use lower lexical symbol or key first.
smallest two, lexical tie
C and D tie
C has count 1 and D has count 1. They are the two smallest items.
Make CD
Merging C and D makes CD with count 2.
C+D=CD,∣CD∣=2
Summary
The first merge is C with D, forming CD. The table keeps that merge as a recomputed row.