3. Rockland Inc. purchased a piece of land five years ago for $150,000 and subsequently added $175,000 in various improvements. The land has a current book value of $225,000. Two options have been presented to the Board regarding the future use of the land: Option 1: Sell the land today for $375,000 (after-tax) Option 2: Destroy the past improvements and build a new factory on the land What is the proper initial cash flow amount of the land if the firm considers Option 2? a) The present book value of $225,000. b) The after-tax salvage value of $375,000. c) The sales price of $375,000 less the book value of the improvements. The original cost to purchase the land, i.e. $150,000. d) e) The property should be valued at zero since it is a sunk cost. ld formula in capital