*Problem 10-3 Grouper Company was incorporated on January 2, 2018, but was unable to begin manufacturing activities until July 1, 2018, because new factory facilities were not completed until that date. The Land and Buildings account reported the following items during 2018 January 31 February 28 May 1 May 1 une 1 June 1 une 1 une 30 uly 1 December 31 Land and building Cost of removal of building Partial payment of new construction Legal fees paid Second payment on new construction Insurance premium Special tax assessment General expenses Final payment on new construction Asset write-up $162,500 9,834 62,340 4,070 43,700 2,280 4,400 38,392 31,020 56,106 414,642 (4,375) $410,267 December 31 Depreciation-2018 at 196 December 31, 2018 Account balance The following additional information is to be considered 1. To acquire land and building, the company paid $82,500 cash and 800 shares of its 8% cumulative preferred stock, par value $100 per share. Fair value of the stock is $118 per share. 2. Cost of removal of old buildings amounted to $9,834, and the demolition company retained all materials of the building. 3. Legal fees covered the following Cost of organization Examination of title covering purchase of land Legal work in connection with construction contract $640 1,450 1,980 $4,070 4. Insurance premium covered the building for a 2-year term beginning May 1, 2018 5. The special tax assessment covered street improvements that are permanent in nature 6. General expenses covered the following for the period from January 2, 2018, to June 30, 2018 $34,375 4,017 $38,392 President's salary Plant superintendent's salary-supervision of new building