Okay I double checked and forty is okay for the AC however there are several issues with the grounding of the regulator on that engine. When the ground is dirty or insufficient to the body of the regulator itself it will not make sufficient voltage (as you have) one fix is to run a separate ground wire from the mount bolt to a good ground and see if it come up. The DC should be 14.5 volts at full throttle and maintain the battery there. So to recap, AC voltage good, need to double check ground, if all that is good you may have a bad regulator (it happens).
Let me know if you need more.
Nice! Now it wont haunt you anymore, and thanks for letting me know!