Health Co. acquires Wellness Ltd. for $40,000,000 in cash and accounts for its investment as a merger. Wellness’s balance sheet at the date of acquisition is as follows:

Assets	Amount	Liabilities and Equity	Amount
Current assets	$2,000,000	Liabilities	$15,000,000
Property, net	$25,000,000	Equity	$12,000,000
Total assets	$27,000,000	Total liabilities and equity	$27,000,000

The fair value of Wellness’s current assets is $200,000 less than book value. The fair value of its property is $3,000,000 less than book value. The book value of its liabilities approximates fair value. There are no unreported assets or liabilities.

Requirement: How much goodwill does Health report for this acquisition?