Michaels Fast Machines Pty Ltd purchased second-hand equipment for its operation for $25,000. The equipment was worth $35,000. Applying the cost principle, how much should the equipment be recorded at in Michaels Fast Machines statement of financial position?

Select one:

a. $30,000 (which is the average of the two prices).

b. $35,000.

c. The company could choose either $25,000 or $35,000.

d. $25,000.