(a) Explain why you would regard the following accounting treatments to be incorrect:

(i) £14,200 paid during the year for the monthly servicing of machinery was capitalised.

(ii) When the motor in a machine ceased because an electrical fault burnt the armature, £7,500 paid for replacing the dynamo was capitalised.

(iii) In relation to the acquisition of a property, £12,500 paid as stamp duty fees and £10,000 paid to the solicitor for conveyancing were posted to the Property maintenance account.

(iv) £120,000 paid for a set of computer terminals was posted to the Stationery account.

(b) Identify the effect of each of the above errors, which occurred during the year ended 31 December 2012, on the profit which has been reported as £1.246 million and net assets at the year-end reported as £4.985 million. (Ignore the effect of depreciation.)