On January 2, 2016 McNally's Corporation acquired equipment for $120,000. The estimated life of the equipment is 5 years or 20,000 hours. The estimated residual value is $20,000. What is the amount of depreciation expense for 2016 and 2017, if McNally's Extra Corporation uses the asset 3,000 hours in 2016 and 4,000 hours in 2017 and uses the units-of-production method of depreciation? Write the journal entry to record the depreciation on Dec 31, 2016.