Sandhill Company manufactures products ranging from simple automated machinery to complex systems containing numerous components. Unit selling prices range from $$200,000$ to $$1,500,000$ and are quoted inclusive of installation. The installation process does not involve changes to the features of the equipment and does not require proprietary information about the equipment in order for the installed equipment to perform to specifications. Sandhill has the following arrangement with Sweet Acacia Inc.

Sweet Acacia purchases equipment from Sandhill for a price of $$1,092,500$ and contracts with Sandhill to install the equipment. Sandhill charges the same price for the equipment irrespective of whether it does the installation or not. Using market data, Sandhill determines installation service is estimated to have a standalone selling price of $$57,500.$ The cost of the equipment is $$630,000.$

Sweet Acacia is obligated to pay Sandhill the $$1,092,500$ upon the delivery of the equipment.

Sandhill delivers the equipment on June $1,2025,$ and completes the installation of the equipment on September $30,2025.$ The equipment has a useful life of $10$ years. Assume that the equipment and the installation are two distinct performance obligations which should be accounted for separately.

$($a$)$

How should the transaction price of $$1,092,500$ be allocated among the performance obligations? $($Do not round intermediate calculations. Round final answers to $0$ decimal places, e$.$g$.5,275.)$

Equipment $

Installation $