On July 1, Hernandez Company purchased equipment costing $30, 300. The equipment has an estimated salvage value of $1, 580 and an estimated useful life of 7 years. Hernandez estimates that over its useful life, the equipment will be used to produce 14, 360 units. In the first year, 1, 763 units were produced. In the second year, 2, 390 units were produced. Compute the depreciation expense for the first two years using the units-of-production method