Question 2 (30 marks) On January 1, 2018, Dayton Mining Company purchased land containing an estimated 15 million tons of iron ore at a cost of $6,000,000. The land without the iron ore is estimated to be worth $600,000. The company expects to operate the mine for 10 years. Buildings costing $550.000 are constructed on the site and are expected to last for 25 years. Equipment costing $350,000 with an estimated life of 12 years is installed. When the mine is closed the buildings and the equipment possess residual value of $50,000 and $30,000 respectively. Straight-line method is used for depreciation of buildings, and double-declining method for depreciation of equipment. An estimated life of 10 years is adopted for both items. During the first two year of operations, Dayton extracted and sold 2 million tons of ore in each year. () Prepare a partial statement of financial position for Dayton Mining Company for the year ended on December 31, 2019, showing how the above long-lived assets would be presented. Include goodwill of $350,000 and show all contra accounts, if applicable in the partial statement. Note: Extra marks will be awarded for proper and clear presentations. (d) In March 2020. Dayton lost a lawsuit about infringement of patent, and paid $100,000 in damages to its competitor, Expose Company. Immediately after the lawsuit, Dayton negotiated an agreement with Expose Company. This agreement cost an additional $1.3 million, but it allowed Dayton to continue to use the patent. Dayton's accountant, Mary Lee, initially recorded the cash payments as "Loss from Lawsuit" and "Patent" respectively. However, Jack Tam, the financial controller, instructed Mary to charge both costs to goodwill. "We are protected from another lawsuit as long as this agreement is in effect," he says. "This is like the goodwill we can ever get from our competitors like Expose. We might as well amortize the cost rather than deduct the full amount from income in 2020. Alternatively, we may include these in goodwill and then sell the goodwill later this year to recover the money." Required: Discuss the technical, and also ethical issues in what Jack Tam proposed