Lori Company exchanged an old machine with a carrying amount of $10,000 and a fair value of $7,000 for a new machine. The new machine had a list price of $55,000. Lori Company paid $43,000 cash and was offered $12,000 as a trade-in allowance in the exchange. At what amount should the new machine be recorded on Lori's books?

a.

$55,000

b.

$53,000

c.

$43,000

d.

$50,000