Santayana Company purchased a machine on January 1, 2009, for $8,000 with an estimated residual value of $2,000 and an estimated useful life of 8 years.On January 1, 2011, Santayana decides the machine will last 12 years from the date of purchase.The residual value is still estimated at $2,000.Using the straight-line method, the new annual depreciation will be

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The machine's depreciable amount is $6,000 ($8,000 - $2,000). By 2011, 2 years of depreciation have been recorded, totaling $1,500 ($750 per year). The remaining depreciable amount is $4,500 ($6,000 - $1,500). With 10 years remaining (12 total - 2 used), the new annual depreciation is $450 ($4,500 / 10).

Santayana Company Purchased a Machine on January 1, 2009, for $8,000