Samtech Manufacturing purchased land and building for $4 million. In addition to the purchase price, Samtech made the following expenditures in connection with the purchase of the land and building:

Title insurance	$	18,000
Legal fees for drawing the contract		6,000
Pro-rated property taxes for the period after acquisition		38,000
State transfer fees		4,200

An independent appraisal estimated the fair values of the land and building, if purchased separately, at $3.6 and $1.2 million, respectively. Shortly after acquisition, Samtech spent $84,000 to construct a parking lot and $42,000 for landscaping. Required: 1. Determine the initial valuation of each asset Samtech acquired in these transactions.

Land =

Building =

Land Improvements =

2. Determine the initial valuation of each asset, assuming that immediately after acquisition, Samtech demolished the building. Demolition costs were $270,000 and the salvaged materials were sold for $7,000. In addition, Samtech spent $81,000 clearing and grading the land in preparation for the construction of a new building.

Land =

Building =

Land Improvements =