Martin Company purchases a machine at the beginning of the year at a cost of $85,000. The machine is depreciated using the double-declining-balance method. The machines useful life is estimated to be 4 years with a $7,000 salvage value. The machines book value at the end of year 3 is:

• $42,500.

• $63,750.

• $74,375.

• $10,625.

• $9,719.