Your company purchased a piece of land five years ago for $150,000 and subsequently added $200,000 in improvements. The current book value of the property is $275,000. There are two options for future use of the land: 1) the land can be sold today for $395,000 on an aftertax basis; 2) your company can destroy the past improvements and build a factory on the land. In consideration of the factory project, what amount (if any) should the land be valued at?

	1.	The aftertax salvage value of $395,000.
	2.	The present book value of $275,000.
	3.	The sales price of $395,000 less the book value of the improvements.
	4.	The original $150,000 purchase of the land itself.
	5.	The property should be valued at zero since it is a sunk cost.