A farming company buys hogs at the end of Year 1 for $200,000. During Year 2, it costs $40,000 to feed and care for the hogs. At the end of Year 2, the estimated fair value of the hogs is $300,000. The estimated cost of selling hogs is 3% of fair value. What is the impact on Year 2 net income? a) no income or loss reported because the $40,000 in costs are capitalized. b) net loss of $40,000 c) net income of $57,000 d) net income of $100,000