On August 1, 2007, Limon Corporation Purchased a New Machine

On August 1, 2007, Limon Corporation purchased a new machine on a deferred payment basis.A down payment of $3,000 was made and 4 monthly installments of $2,500 each are to be made beginning on September 1, 2007.The cash equivalent price of the machine was $12,000.Limon incurred and paid installation costs amounting to $500.The amount to be capitalized as the cost of the machine is

A) $12,000.
B) $12,500.
C) $13,000.
D) $13,500.