On January 2, Novation Corp. replaced its boiler with a more efficient one. The following information was available on that date: Purchase price of new boiler $120,000 Carrying amount of old boiler 10,000 Fair value of old boiler 4,000 Installation cost of new boiler 16,000 The old boiler was sold for $4,000. What amount should Novation capitalize as the cost of the new boiler?