Final answer:
The proper depreciation expense on the machine for 2018 using a straight-line method is $13,214.29.
Step-by-step explanation:
The proper depreciation expense on the machine for 2018 can be calculated using the straight-line depreciation method. Straight-line depreciation allocates an equal amount of depreciation expense over the useful life of the asset. To calculate the annual depreciation expense, subtract the salvage value from the cost of the machine and divide by the number of years the machine is expected to be useful.
In this case, the machine cost is $100,000 and the salvage value after 7 years is estimated to be $7,500. The useful life of the machine was initially expected to be 10 years, but has been revised to 7 years.
Using these values, the annual depreciation expense for the machine in 2018 can be calculated as follows:
Depreciation Expense = (Cost of Machine - Salvage Value) / Useful Life
Depreciation Expense = ($100,000 - $7,500) / 7
Depreciation Expense = $13,214.29 (rounded to the nearest cent)