 In this discussion, we will discuss the discussion question of describe the cost principle property plant and equipment and lump sum purchases. When discussing the cost principle, we will be discussing it in relationship to property plant and equipment. And the cost principle basically means we're going to record the property plant and equipment at cost. So we're going to record that cost, but it also means that when we record something at cost, we're going to include any expenditures necessary to get that asset in place and ready for its use within the business. So included in the cost is, of course, they're going to be the price of the sticker price, whatever property plant and equipment we are going to be purchasing, as well as anything that we needed in order to get it in place. If we had to pay for shipping in order to get the equipment here, we'd want to include the shipping. If we had to pay for insurance on the shipping in order to get the equipment here, we'd want to pay for that if we had temporary storage in order to get the equipment ready for use. We want that installation that would all be capitalized, not expensed, those types of items, which we may think at first might think shipping expense, installation expense, but because they're part of the initial purchase and to get the equipment up and running, they would be part of the property plant and equipment capitalized as property plant and equipment. It's also important to note that we are going to be recording at cost and then we'll depreciate those costs in accordance with the cost principle and that's opposed to or different from trying to have a fair market value at any given time. At the point in time that we purchase, we're probably at fair market value because we purchased it on the market. But note that after that point in time, we are allocating the cost in accordance with the allocation of the cost to the time period in which it's consumed, not necessarily trying to find the fair market value and report the fair market value of the equipment at any given time. A lump sum purchase is going to be a type of purchase where we purchase different items that we're going to have to record differently into one lump sum purchase. So the typical lump sum purchase would be something like we bought building land possibly improvements all in one lump sum. We bought one lump sum purchase and of course when we do that, when we buy something like real estate, we pay one price and typically that's the lump sum price. We don't have the breakout typically between especially the part that's the land versus the part that is the building. And it's important for us to break that out because the land isn't going to be depreciated whereas the building will be. And so we need to break those out into their components so that we can depreciate the building which will deteriorate over time, whereas the land will not. And therefore whatever we put in on the books as land will remain on the books indefinitely for the most part, whereas the anything we put on the books for property plant and equipment will depreciate. So a lump sum purchase is going to be somehow broken out. Now we can do that in a couple of different ways. There might be an appraisal. We might have property taxes which would have had to take some type of appraisal in order to record property taxes. And even if that's not exactly what we have in terms of the purchase price, meaning the appraisal doesn't match the purchase price, we can use a ratio analysis in order to figure out the breakout between the components of the lump sum purchase such as a building, such as land for a lump sum purchase and break that information out into its component parts.