On 1 January 2016, Combo Ltd purchased a factory (and the land on which it stood), together with the machinery in it, for $700 000 in total. The independently determined appraisal values were:

In January, a portion of the building was demolished, at a cost of $1200, to allow for the extension of the building to house new machinery. Two hundred dollars was received for materials salvaged from the demolition. However, in the course of the demolition, existing machinery was damaged, requiring expenditure of $400 on repairs. This amount was not recoverable from the demolition company. In February and March the extensions were built. Construction costs were $40000, architect's fees were $4000 and legal fees were $500. In April, new machinery was purchased for $50000 (list price). Sales tax of 4 percent was paid, as were freight and installation costs of $750. In addition, $500 was spent on making changes to an existing machine to extend its useful life.
1. If a balance sheet was to be prepared at the end of April 2016, what amounts would be shown for the cost of land, buildings and machinery? Prepare separate schedules, listing individual components of the cost of land, buildings and machinery, to support your answer.
2. What is the effect on shareholders' equity of the above transactions (if any), assuming all payments were made in cash? Briefly explain your answer.

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Land Building Machinery $ 320000 180000 200 000