On December 1, 2014, Xeon Company bought land and an accompanying warehouse from Yen Company for $800,000 . The fair market values of the land and the building at the time of purchase were $700,000 and $300,000, respectively. How much of the purchase price should Xeon Company allocate to the land and how much should be allocated to the building?
a. $457,143 and $342,857, respectively.
b. $700,000 and $300,000, respectively.
c. $560,000 and $240,000, respectively.
d. $500,000 and $300,000, respectively
c
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