Expenditures After Acquisition

Roanoke Manufacturing placed a robotic arm on a large assembly machine on January 1. At that time, the assembly machine was expected to last another 3 years. The following information is available concerning the assembly machine. Cost, assembly machine $750,000 Accumulated depreciation, Jan. 1 480,000 The robotic arm cost $210,000 and was expected to extend the useful life of the machine by 3 years. Therefore, the useful life of the assembly machine, after the arm replacement, is 6 years. The assembly machine is expected to have a residual value of $126,000 at the end of its useful life.

2. Compute the revised amount of depreciation expense for the machine using the straight-line method.