Mooney company shows the following information for equipment purchased on January 1 of Year 1

Useful life : 10 years

Residual value $ 8,000

Original cost $ 400,000 Depreciation method Straight - line expense in Year 3

On January 1 of Year 3 , the company determined that the equipment's life will only extend to a total of 6 years and the residual value is expected to be $ 2,000 Compute depreciation in year 3.

Year 3 depreciation expense :