Oslo Company was formed on January 1, 2007, and began constructing a new plant. At the end of 2007, its auditor discovered that all expenditures involving long-term assets had been debited to an account called Fixed Assets. An analysis of the Fixed Assets account, which had a year-end balance of $2,644,972, disclosed that it contained the following items:

Oslo Company sold the timber it cleared from the land to a firewood dealer for $5,000. This amount was credited to Miscellaneous Income.
During the construction period, two of Oslo’s supervisors devoted full time to the construction project. Their annual salaries were $48,000 and $42,000, respectively. They spent two months on the purchase and preparation of the land, six months on the construction of the building (approximately one-sixth of which was devoted to improvements on the grounds), and one month on machinery installation. When the plant began operation on October 1, the supervisors returned to their regular duties. Their salaries were debited to Factory Salaries Expense.
Required 1. Prepare a schedule with the following column headings: Land, Land Improvements, Buildings, Machinery, and Expense. Place each of the above expenditures in the appropriate column. Negative amounts should be shown in parentheses. Total the columns.
2. User Insight: What impact does the classification of the items among several accounts have on evaluating the profitability performance of the company?
Comparison of Depreciation Methods

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Cost of land Surveying costs Transfer of title and other fees required by the county $ 316,600 4,100 920 Broker's fees for land 21,144 Attorney's fees associated with land acquisition 7,048 Cost of removing timber from land 50,400 Cost of grading land 4,200 Cost of digging building foundation 34,600 Architect's fee for building and land improvements (80 percent building) 64,800 Cost of building construction 710,000 Cost of sidewalks 11,400 Cost of parking lots 54,400 Cost of lighting for grounds 80,300 Cost of landscaping Cost of machinery 11,800 989,000 Shipping cost on machinery 55,300 Cost of installing machinery 176,200 Cost of testing machinery 22,100 Cost of changes in building to comply with safety regulations pertaining to machinery 12,540 Cost of repairing building that was damaged in the installation of machinery 8,900 Cost of medical bill for injury received by employee while installing machinery 2,400 Cost of water damage to building during heavy rains prior to opening the plant for operation 6,820 Account balance $2,644,972