Cost cut purchased machinery for its manufacturing process in early March. The machinery cost $600 000, excluding installation costs of $50 000. Cost cut estimates that the machinery has a useful life of five years, and that its residual value at the end of that time will be nil. Using straight-line depreciation, estimate the depreciation expense to be recorded in the income statement for the year in which the machine was purchased and the subsequent year assuming cost cuts reporting period ends on 30 June.