In January 2014, Bevis Company exchanged an old machine, with a book value of $256,000 and a fair value of $260,000, and paid $40,000 cash for a similar used machine having a fair value of $300,000. The exchange lacked commercial substance. At what amount should the machine acquired in the exchange be recorded on Bevis' books?
$256,000
$296,000
$300,000
$304,000