A firm has decided to replace an existing asset with a newer Model. The

existing asset originally cost $30,000 . The current book value of the existing

asset for tax purposes is $ 14,400. The existing asset can be sold for

$ 25,000. The new asset will cost $ 75,000. If the assumed tax rate is 40 %

on ordinary income and capital gains, the initial investment is ________

A. $ 42,000

B. $ 52,440

C. $ 54,240

D. $ 50,000