Steiger Company paid $50,000,000 for a warehouse and related assets from a company that was in bankruptcy. The warehouse includes land, building, moving equipment, and heating / ventilation / air conditioning (HVAC) system. An independent appraiser valued these items individually as follows:
PPE category Appraised value
Land …………………………………$28,000,000
Building …………………………….. 21,000,000
Moving equipment ………………….. 4,000,000
HVAC system ……………………… 3,000,000
Total …………………………………$56,000,000
Required:
Allocate the purchase price among the assets acquired.