1. On January 1, 2012, Blagojevich, Inc. purchases and puts into service a machine costing $150,000 (including all capitalizable costs). The estimated salvage value is $10,000, and the estimated useful life is 10 years. They use straight-line depreciation.

On January 1, 2016, Blagojevich spends $4,000 to extend the useful life of the machine an additional two years.

Calculate the depreciation expense associated with the machine for the year ended December 31, 2016.