Santayana Company purchased a machine on January 1, 2019, for $60,000.The machine has an estimated salvage value of $15,000 and an estimated useful life of eight years.On January 1, 2021, Santayana decides the machine will last 12 years from the date of purchase.The salvage value is still estimated at $15,000.Using the straight-line method, the new annual depreciation will be

Question

Quizplus · Accepted Answer

The new annual depreciation is calculated by subtracting the salvage value from the cost and then dividing by the new useful life. The calculation is ($60,000 - $15,000) / 12 = $3,375.

Santayana Company Purchased a Machine on January 1, 2019, for $60,000.The