eBookQuestion Content AreaAllocating payments and receipts to fixed asset accountsThe following payments and receipts are related to land, land improvements, and buildings acquired for use in a wholesale ceramic business. The receipts are identified by an asterisk.ItemDescriptionAmounta.Fee paid to attorney for title search$$2,000$ b$.$Cost of real estate acquired as a plant site: Land$280,000$ b$.$ Cost of real estate acquired as a plant site: Building $($to be demolished$)50,000$ c$.$Delinquent real estate taxes on property, assumed by purchaser$15,000$ d$.$Cost of razing and removing building acquired in $($b$)6,000$ e$.$Proceeds from sale of salvage materials from old building$4,000*$f$.$Special assessment paid to city for extension of water main to the property$28,000$ g$.$Architects and engineers fees for plans and supervision$70,000$ h$.$Premium on $1-$year insurance policy during construction$7,000$ i$.$Cost of filling and grading land$13,000$ j$.$Money borrowed to pay building contractor$900,000*$k$.$Cost of repairing windstorm damage during construction$5,500$ l$.$Cost of paving parking lot to be used by customers$33,000$ m$.$Cost of trees and shrubbery planted$11,000$ n$.$Cost of floodlights installed on parking lot$1,000$ o$.$Cost of repairing vandalism damage during construction$2,000$ p$.$Proceeds from insurance company for windstorm and vandalism damage$7,500*$q$.$Payment to building contractor for new building$800,000$ r$.$Interest incurred on building loan during construction$34,500$ s$.$Refund of premium on insurance policy $($h$)$ canceled after $11$ months$600*$Required:$1.$ Assign each payment and receipt to Land $($unlimited life$),$ Land Improvements $($limited life$),$ Building, or Other Accounts. Choose the correct account from the dropdown list for each letter and enter the appropriate amount. Enter receipts as negative amounts using the minus sign.ItemAccountAmounta.LandLand ImprovementsBuildingOther AccountsLand$fill in the blank $2$b$.$LandLand ImprovementsBuildingOther AccountsLand$fill in the blank $4$c$.$LandLand ImprovementsBuildingOther AccountsLand$fill in the blank $6$d$.$LandLand ImprovementsBuildingOther AccountsLand$fill in the blank $8$e$.$LandLand ImprovementsBuildingOther AccountsLand$fill in the blank $10$f$.$LandLand ImprovementsBuildingOther AccountsLand$fill in the blank $12$g$.$LandLand ImprovementsBuildingOther AccountsBuilding$fill in the blank $14$h$.$LandLand ImprovementsBuildingOther AccountsBuilding$fill in the blank $16$i$.$LandLand ImprovementsBuildingOther AccountsLand$fill in the blank $18$j$.$LandLand ImprovementsBuildingOther AccountsOther Accounts$fill in the blank $20$k$.$LandLand ImprovementsBuildingOther AccountsOther Accounts$fill in the blank $22$l$.$LandLand ImprovementsBuildingOther AccountsLand Improvements$fill in the blank $24$m$.$LandLand ImprovementsBuildingOther AccountsLand Improvements$fill in the blank $26$n$.$LandLand ImprovementsBuildingOther AccountsLand Improvements$fill in the blank $28$o$.$LandLand ImprovementsBuildingOther AccountsOther Accounts$fill in the blank $30$p$.$LandLand ImprovementsBuildingOther AccountsOther Accounts$fill in the blank $32$q$.$LandLand ImprovementsBuildingOther AccountsBuilding$fill in the blank $34$r$.$LandLand ImprovementsBuildingOther AccountsBuilding$fill in the blank $36$s$.$LandLand ImprovementsBuildingOther AccountsBuilding$fill in the blank $382.$ Determine the amount debited to Land, Land Improvements, and Building.LandLand ImprovementsBuilding$fill in the blank $39$$fill in the blank $40$$fill in the blank $413.$ Land used as a plant site fill in the blank $1$ of $4$doesdoes notdoes not lose its ability to provide services; thus, it fill in the blank $2$ of $4$isis notis not depreciated. However, land improvements fill in the blank $3$ of $4$dodo notdo lose their ability to provide services as time passes and are, therefore, fill in the blank $4$ of $4$not depreciateddepreciateddepreciated$\mathrm{.}4.$ What would be the effect on the income statement and balance sheet if the cost of filling and grading land of $$13,000[$payment $($i$)]$ was incorrectly classified as Land Improvements rather than Land? Assume Land Improvements are depreciated over a $20-$year life using the double$-$declining$-$ balance method.Depreciation expense would be overstated, land would be understated, and net income would be understated.Depreciation expense would be overstated, land improvements would be overstated and net income would be overstated.Depreciation expense would be overstated, land would be understated, and net income would be understated.