You are performing the year-end audit of Halvorson Fine Foods Ltd for 31stDecember 2012. The client has prepared the following schedule for fixed assets and related allowance for depreciation accounts. You have compared the opening balances with your prior-year audit working papers. The following information is found during your audit:a.All equipment is depreciated on a straight-line basis (no salvage value taken into consideration) based on the following estimated lives: buildings, 25 years; all other items, 10 years. The corporation's policy is to take one-half year's depreciation on all asset acquisitions and disposals occurring during the year.b.The corporation completed the construction of a wing on the plant building on 30 June of this year. The useful life of the building was not extendedby this addition. The lowest construction bid received was $17,500, the amount recorded in the buildings account. Company personnel were used to construct the addition as a cost of $16,000 (materials $7,500, labour $5,500 and overhead $3,000)c.On 18thAugust, Halvorson paid $5,000 for paving and fencing a portion of land owned by the corporation for use as a parking lot for employees. The expenditure was charged to the land account.Assets:$$$$ Land22,5005,00027,500 Buildings120,00017,500137,500 Machinery and equip.385,00040,40026,000399,400$527,500$62,900$26,000$564,400Allowance for depreciation:$$$$ Building60,0005,15065,150 Machinery and equip.173,20039,220212,420$233,200$44,370$277,570DescriptionFinal Balance, 31 December Additions RetirementsFinal Balance, 31 December HALVORSON FINE FOODS LTDANLAYSIS OF FIX ED ASSETSFOR THE YEAR ENDED 31 DEC EMBER 2 012d.The amount shown in the retirement's column for the machineryand equipment asset represents cash received on 5thSeptember, on disposal of a machine purchased in July 2001 for $48,000. The bookkeeper recorded a depreciation expense of $3,500 on this machine in 2012.e.Crux City donated land and building appraised at$10,000 and $40,000, respectively, to Halvorson for a plant. On 1stSeptember, the corporation began operating the plant. Because no costs were involved, the bookkeeper made no entry for the foregoing transaction.Required:In addition to inquiring of the client, explain how you found each of the described items of information during the audit