Chico Company Paid $520,000 for a Basket Purchase That Included

Multiple Choice

Chico Company paid $520,000 for a basket purchase that included office furniture, a building and land. An appraiser provided the following estimates of the market values of the assets if they had been purchased separately: Office furniture, $120,000; Building, $420,000; and Land, $90,000. Based on this information, what is the cost that should be allocated to the office furniture? (Round intermediate percentage values to a whole percentage.)

A) $98,800
B) $120,000
C) $187,852
D) $57,700