acquisition of a group of assets for a single price. The cost should be allocated to the assets based on their fair market values. Assume $75,000 is paid to acquire land, building, and equipment having the fair market values of $40,000, $25,000, and $35,000, respectively. The allocated cost is shown below:

                                     Fair Market                          Value Allocated Cost
Land                                $ 40,000                                   $30,000
Building                              25,000                                     18,750
Equipment                          35,000                                     26,250
Total                               $100,000                                  $ 75,000

For example, the allocated cost assigned to the land account is arrived at as follows:

40.000/100.000 * 75.000 = 30.000