Rodriguez Company pays $342,225 for real estate with land, land improvements, and a building. Land is appraised at $250,000; land improvements are appraised at $75,000; and a building is appraised at $175,000. Required:
a. Allocate the total cost among the three assets.
b. Prepare the journal entry to record the purchase.

a. The cost of each of the assets will be proportional based on their individual costs.

Total individual costs = 250,000 + 75,000 + 175,000

= $500,000

Cost of land = 250,000/500,000 * 342,225 = $‭171,112.5‬0

Cost of land improvements = 75,000/500,000 * 342,225 = $‭51,333.75‬

Cost of building = 175,000/500,000 * 342,225 = $‭119,778.75‬

b.

DR   Land                                                       $171,112.50

       Land Improvements                              $51,333.75

       Building                                                  $119,778.75

       CR Cash                                                                        $342,225

if you do not file your taxes you will not have a job, and you credit rate will go down.