Charles owns a sign manufacturing facility. He purchased a vinyl stretching machine on June 4, 20x1 $61,000. Charles financed 80% of the machine with a 7% 5 year loan through Chase Bank. He made a cash down payment of $12,200. The monthly Note payment is $1,207.87.

Depreciation Rate for Recovery Period
Year	3-year	5-year	7-year	10-year	15-year
1	33.33%	20.00%	14.29%	10.00%	5.00%

What is the annual depreciation for the equipment in year 1?

• A. $8,717
• B. $6,100
• C. $20,331
• D. $12,200