On January 1, Year 1, ABC Company purchased a piece of equipment with a list price of $100,000. The seller agreed to allow a 2% discount. Delivery terms were FOB shipping point and freight amounted to $1,500. ABC had to hire a specialist for $5,000 to setup the equipment. The equipment operator was paid a salary of $40,000 in Year 1. ABC took out two insurance policies. The first cost $3,000 and covered the equipment during transport while the other cost $10,000 and covered the equipment during use throughout Year 1. The equipment had a 7 year useful life and an expected salvage value of $12,000. All costs are paid in cash.

Determine the amount to be capitalized in an asset account for the purchase of the equipment.

Group of answer choices

$107,500

$98,000

$157,500

$100,000

$99,500