Current Attempt in Progress A depreciable asset with a cost of $48580 has a residual value of $2200 and a useful life of 10 years. Total estimated units of output are 77300 and in year 1 a tot of 5900 units were produced. Under the straight-line method and the units-of-activity method the depreciation expense for the first year would be

A depreciable asset with a cost of $48580 has a residual value of $2200 and a useful life of 10 years. Total estimated units of output are 77300 and in year 1 a totf f of 5900 units were produced. Under the straight-line method and the units-of-activity method the depreciation expense for the first year would be Pharoah Flight Academy acquired a new site for its training operations. The company was able to find a small unused airport with an updated runway and hangar that could be used to accommodate a flight simulator, small aifcraft, and classrooms. The location was. ideal as it was close to the city centre with a large population base from which to attract students. Pharoah paid 56.50 million to acquire the site. Prior to providing fenancing for the purchase, the bankrequired that an appraisal be completed of the property. The evaluation appraisal report came back with the following estimated market valives: land $3,385,800, building $2,445,300, and land improvements $438,900. Pharoah managecnent explained, to the bank's sotisfiction, that it paid the $230,000 premium because of the property's prowimity to the city centre and access to a large population base from which to draw students. (a) Allocate the 56.50 -million purchase price to the land, building, and land improvements