Kenya Ltd Acquires a New Machine $\begin{array}{llcc} \text { Comportent A: } &\$198,000 \\ \text {Component B: } &\$240,000\\\end{array}$

Kenya Ltd. acquires a new machine. It is comprised of two different components (A and B) that are expected to be overhauled at different times. The acquisition costs of the components are as follows:
$\begin{array}{llcc} \text { Comportent A: } &\$198,000 \\ \text {Component B: } &\$240,000\\\end{array}$


Component A is expected to have a useful life of 5 years and a residual value of $ 20,000 before the first major overhaul is required. Component B is expected to have a useful life of 7 years and a residual value of $ 15,000 before its first overhaul. Kenya uses straight-line depreciation for all its equipment. At the beginning of year 6, component A undergoes a major overhaul at a cost of 100,000. The work is expected to extend its life by 3 years, but the residual value will then be zero. What is the net book value of component A one year after the overhaul?

A) $ 120,000
B) $ 80,000
C) $ 66,667
D) $ 40,000