A company owns a 6-year old gear hobber that has a book value of $60,000. The present market value of the hobber is $80,000. A new gear hob- ber can be purchased for $450,000. Using an insider’s point of view, what is the net first cost of purchasing the new gear hobber?
1. $370,000
2. $450,000
3. $310,000
4. $390,000