The asset side of the 2016 balance sheet for Willamette Valley Vineyards is as follows: WILLAMETTE VALLEY VINEYARDS, INC. Balance Sheet (excerpts) Dec. 31, 2016 Dec. 31, 2015 CURRENT ASSETS Cash and cash equivalents $ 5,706,351 $ 4,010,664 Restricted cash 0 1,476,232 Accounts receivable, net 1,871,450 1,684,502 Inventories 11,970,656 10,632,462 Prepaid expenses & other current assets 399,740 131,173 Income tax receivable 0 204,513 Total current assets 19,948,197 18,139,546 Investment in Kore Wine Company 59,186 60,000 Vineyard development costs, net 4,666,794 3,699,947 Property and equipment, net 20,196,945 16,729,162 TOTAL ASSETS $44,871,122 $38,628,655 The following footnotes are from the annual report for Willamette Valley Vineyards for 2016. Vineyard Development Costs Vineyard development costs consist primarily of the costs of the vines and expenditures related to labor and materials to prepare the land and construct vine trellises. The costs are capitalized until the vineyard becomes commercially productive, at which time annual amortization is recognized using the straight-line method over the estimated economic useful life of the vineyard, which is estimated to be 30 years. Accumulated amortization of vineyard development costs aggregated $1,185,823 and $1,109,406 at December 31, 2016 and 2015, respectively. Amortization of vineyard development costs are included in capitalized crop costs that in turn are included in inventory costs and ultimately become a component of cost of goods sold. For the years ending December 31, 2016 and 2015, approximately $76,417 and $75,669, respectively, was amortized into inventory costs. Note 4. Property and Equipment December 31, December 31, 2016 2015 Construction in progress $ 449,409 $ 482,284 Land and improvements 8,063,716 5,089,472 Winery buildings and hospitality center 14,458,309 13,756,320 Equipment 10,122,593 9,055,987 33,094,027 28,384,063 Less accumulated depreciation (12,897,082) (11,654,901) $ 20,196,945 $ 16,729,162 Depreciation expense $ 1,254,455 $ 1,194,191 Required: a. Explain the difference between Vineyard development costs and Land and improvements. b. Calculate the percent used up of the Vineyard development costs. c. Calculate the percent used up of the Property and equipment. What does this imply for future cash flows for Willamette Valley Vineyards? d. Assume that on January 1, 2017 the company determined that the Vineyard development costs had a fair value of $4,000,000. How would this affect the companys balance sheet and income statement in 2017?