Blossom 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 aircraft , and classrooms . The location was ideal as it was close to the city centre with a large population base from which to attract students . Blossom paid $ 6.20 million to acquire the site . Prior to providing financing for the purchase , the bank required that an appraisal be completed of the property . The evaluation appraisal report came back with the following estimated market values : land $ 3,331,800 , building $ 2,406,300 , and land improvements $ 431,900 . Blossom management explained , to the bank's satisfaction , that it paid the $ 30,000 premium because of the property's proximity to the city centre and access to a large population base from which to draw students . ( a1 ) Allocate the $ 6.20 - million purchase price to the land , building , and land improvements