As part of the initial investment, Ray Blake contributes equipment that had originally cost $118,300 and on which accumulated depreciation of $88,725 has been recorded. If similar equipment would cost $158,700 to replace and the partners agree on a valuation of $56,700 for the contributed equipment, what amount should be debited to the equipment account?

a.$42,525

b.$56,700

c.$158,700

d.$118,300