243. Santayana Company purchased a machine on January 1, 2012, for $24,000 with an estimated residual value of $6,000 and an estimated useful life of 8 years. On January 1, 2014, Santayana decides the machine will last 12 years from the date of purchase. The residual value is still estimated at $6,000. Using the straight-line method, the new annual depreciation will be

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The machine's book value on January 1, 2014, is $18,000 ($24,000 - $6,000 residual value - $6,000 accumulated depreciation for 2 years). With a revised useful life of 12 years, 10 years remain. The new annual depreciation is ($18,000 - $6,000) / 10 = $1,200.