Exercise 7-42 (Algorithmic) Revision of Depreciation

On January 1, 2009, Blizzards-R-Us purchased a snow-blowing machine for $85,000. The machine was expected to have a residual value of $5,000 at the end of its five-year useful life. On January 1, 2011, Blizzards-R-Us concluded that the machine would have a remaining useful life of six years with a residual value of $770.

1.Determine the revised annual depreciation expense for 2011 using the straight-line method. $ per year