Which of the following statements is correct?
1
The amount spent by way of lawyer's fees to defend a suit in which a firm's factory site is claimed to be related to the plaintiff's land is treated as capital expenditure.
2
Purchase of second hand machinery Rs. 10,000 is treated as revenue expenditure on overhauling.
3
The amount spent to reduce the working expenses is treated as revenue expenditure.
4
Paid to acquire the property Rs. 10,000 is treated as capital expenditure on legal fees.