I created the following worksheet to help students learn how to proportionally allocate the purchase price of a group of assets. It works for concepts in the Intermediate Accounting textbook we use by David Spiceland, et al:

• In Chapter 6, we learn about the five steps of revenue recognition. We must find or calculate the stand-alone selling prices (SASPs) for the performance obligations. Step 4 is when we “allocate the transaction price to the performance obligations.”
• In Chapter 10, we learn about lump sum PPE and intangible asset acquisitions. When the fair values of the acquired assets are higher than the acquisition price, we have to allocate the acquisition price to each asset acquired.
• The vocabulary differs, but the allocation process is the same in both instances.

I like this worksheet because I can reinforce a single process from two chapters. Plus, at the bottom of the page I included a professional tip describing why it is important to cultivate the skill of carefully following written instructions.

I hope you enjoy this worksheet. Download the PDF here: Proportional allocation worksheet for use in Chapters 6 and 10