Kelly Machines reported the following information about two of its machines as of December 31, 2023.

Instructionsa. Calculate the annual depreciation for each asset using the straight-line method.b. Calculate the accumulated depreciation and book value of each asset on December 31, 2024.c. If the company determined during 2025 that machine #2 now has a salvage value of $10,000, would you expect the accumulated depreciation as of December 31, 2024, to change? If so, would it likely increase or decrease?

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Machine #1 #2 Date Acquired Jan. 1, 2014 July 1, 2023 Cost $800,000 120,000 Useful Life (in years) 20 5 Salvage Value $40,000 5,000