Canliss Mining uses the retirement method to determine depreciation on its office equipment. During 2014, its first year of operations, office equipment was purchased at a cost of $15,200. Useful life of the equipment averages four years and no salvage value is anticipated. In 2016, equipment costing $4,400 was sold for $640 and replaced with new equipment costing $7,900. Canliss would record 2016 depreciation of:

$3,800.

$3,760.

$7,260.

None of these answer choices are correct.