Pointer Company buys a piece of property in north Toronto that has the following costs associated with the purchase:

 

Invoice price for land and building = $906,000 Legal fees associated with the purchase = $16,000 Unpaid property taxes assumed by Pointer as part of the purchase agreement = $48,000 Cost of having property professionally appraised = $17,600

 

 The appraisal report shows the building has an appraised market value of $600,000 and the land has an appraised value of $160,000.

 

Required 1: What amount should be capitalized as the value of the land on Pointer's book? $

Required 2: What amount should be capitalized as the value of the building on Pointer's book? $

Required 3: If the property acquired will be depreciated in 40 years with no residual value (assume the straight-line depreciation is used), what is the depreciation expense for the first full year of use? $