I. Sandhu Manufacturing Co$.$ was organized as a corporation on January $2,2023$ at which time it began construction of its production facilities. The new factory was completed on September $30$ and on October $1,2023,$ operations began.

Requirements: Determine the correct balance on December $31,2023$ for the land and buildings accounts. You will need to compute two balances, one for land and one for buildings.Sandhu provided a list of the following transactions that management thought might be included in the cost of the land and building.

a$.$ On January $2,$ Sandhu Manufacturing purchased the land on which the factory would be constructed along with an old run$-$down building that it planned to demolish. Sandhu paid $$200,000$ in cash and issued $1000$ shares of its common stock in exchange for the property. The stock had a par value of $$50$ per share. Because the corporation was privately held, the stock was not actively traded but Sandhu estimated that the stock would likely sell for about $$110$ per share. An independent appraisal of the land and dilapidated building estimated the combined value was $$300,000.$

b$.$ On January $15,$ Sandhu paid Robinson Demolition Co$.$ $$10,000$ to demolish the building. Sandhu was able to sell the material salvaged from the building for $$2,000.$

c$.$ On April $1,$ Sandhu paid its attorney, Paul Lehr, $$10,000$ for legal services provided in the first quarter of $2023.$ The following itemized billing was received:

$1.$ Cost to organize the corporation including preparation and filing of articles of incorporation, bylaws, and other necessary documents. $$5,000$

$2.$ Services associated with the land purchase $3,000$

$3.$ Services associated with obtaining building permits and other legal services related to construction of the building. $2,000$

d$.$ On May $1,$ Sandhu made the following three payments related to its factory facilities.

$1.$ Fire insurance premium on the new building, $$9,600.$ The premium paid for coverage for two years beginning on the date of payment.

$2.$ Special tax assessment by the city for extending the street to the property, $$4,500.$

$3.$ Payment of half the construction costs to Gastelum Construction Co$.,$ $$450,000.$

e$.$ On September $30,$ the remaining $$450,000$ was paid to Gastelum Construction Co$.$

f$.$ Aaron Sandhu, the CEO of Sandhu Manufacturing Co$.$ received a salary of $$36,000$ during the first nine months of $2023,$ with the expectation of increasing his salary to $$8,000$ a month once production began.

g$.$ Andres Sandhu, Aaron$$s son, will be supervisor of one of the two production departments once operations begin. He received a $$9,000$ consulting fee for overseeing the new building construction during the first nine months of $2023.$

h$.$ Property values increased significantly during the first half of $2023.$ Aaron had the property reappraised on September $30$ and found the value of the land had increased $$100,000$ over what was paid.