Hubert purchases Fran's jewelry store for $975,000. The identifiable assets of the business are as follows:

Basis ----- FMV

Inventory $125,000 $150,000

Accounts receivable 55,000 50,000

Building 200,000 275,000

Land 280,000 300,000

Hubert and Fran agree to assign $125,000 to a 5-year covenant not to compete. How should Hubert allocate the $975,000 purchase price to the assets?