Sam's Corporation paid $550,000 to acquire land, building, and equipment. At the time of the acquisition, Sam paid $50,000 to have the property appraised. The following values were determined from the appraisal:

Land

$180,000

Building

$285,000

Equipment

$175,000

Respond to the following questions:

• What cost should Sam assign to the land, buildings, and equipment, respectively? 
• How should the journal entry be recorded on the corporation's books to describe this acquisition? 
• Why is it necessary to allocate a lump sum purchase amount among the individual assets acquired? 
• What are the characteristics that an asset must have for it to be classified as property, plant, and equipment? 
• Generally accepted accounting principles (GAAP) requires that property, plant, and equipment should be recorded at historical cost. What are the advantages of recording property, plant, and equipment at historical cost?