Whispering Winds Corporation manufactures ballet shoes and is in a period of sustained growth. In an effort to expand its production capacity to meet the increased demand for its products, the company recently made several acquisitions of plant and equipment. Tanya Mullinger, newly hired with the title Capital Asset Accountant, requested that Walter Kaster, Whispering Winds's co review the following transactions: Transaction 1 controller, On June 1, 2020, Whispering Winds purchased equipment from Venghaus Corporation. Whispering Winds issued a $20,000, 4-year, non-interest-bearing note to Venghaus for the new equipment. Whispering Winds will pay off the note in 4 equal instalments due at the end of each of the next 4 years. At the transaction date, the prevailing market interest rate for obligations of this nature was 9%. Freight costs of $320 and installation costs of $510 were incurred in completing this transaction. The new equipment qualifies for a $1,670 government grant. Transaction 2 On December 1, 2020, Whispering Winds purchased several assets of Haukap Shoes Inc., a small shoe manufacturer whose owner was retiring. The purchase amounted to $209,500 and included the assets in the following list. Whispering Winds engaged Tennyson Appraisal Inc., an independent appraiser, to determine the assets' fair values, which are also provided. Haukap Book Value Fair Value Inventory $59,740 $49,860 Land 39,550 79,776 Building 69,730 119,664 $169,020 $249,300