QI. You have been appointed as an accountant of M.K. Industries a company formed by Mr Mutiso and Mr K.Kyalo to manufacture cooking fats for sale. While reviewing the accounting records of the company, you discovered that the following transactions and events were recorded during the year ending 30 September 1993. (i) Stock was acquired at sh.29 per unit, throughout the current year, until the last purchase (which was still in raw materials state at the end of the year) was made in September 1993. At that time the company was able to negotiate a special price and acquired 10,000 units at sh.25 per umit. The purchase was recorded as follows: Dr. Stock Shs.290,000 Ст. Cash Shs. 250,000 Cr. Revenue Shs. 40,000 (ii) On 2 January 1993 a new truck was purchased for sh.270, 000. The truck had an estimated useful life of five years and a residual value of sh.20, 000. Depreciation expenses for the year (straight-line method) was recorded as follows to avoid reporting a net operating loss. Dr. Depreciation expense: trucks sh.20, 000 Cr. Provision for depreciation: sh.20, 000 trucks (ii) M.K. Industries purchased an expensive special-purpose machine with an estimated useful life of 10 years. Proper installation of the machine required that it be set in the concrete floor of the factory. Once the machine was installed the assistant factory manager argued that the machine had no resale value and thus directed that the entire cost of the machine should be written off in the current year. (iv) Land was reported at its estimated selling price, which is substantially higher than its cost. The increase in value was included in the income statement. (v) The personal assets of MMutiso and K.Kyalo are not included in the financial statements of the business although M.Mutiso and K.Kyalo are agreeable to guaranteeing the bank overdraft of the business. Required: For each of the above items, explain which basis of accounting principle(3), concept(s) or convection(s), if any, are violated or observed. In each case, indicate the correct treatment