A company bought new heating system to replace (exchange) its old system that had an original cost of $43,000 and accumulated depreciation of $36,000. The company also paid $40,000 cash. If the transaction has commercial substance, and the company lost $2,000 in this transaction, then the company should record the new heating system at:

Select one:

a. All answers are wrong.

b. $40,000.

c. $45,000.

d. $42,000.