On January 2, 2019 McNally's Extra Corporation Acquired Equipment for $120,000

On January 2, 2019 McNally's Extra 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. If McNally's Extra Corporation uses the straight-line method of depreciation, what will be the debit to Depreciation Expense for the year ended December 31, 2020, during which period the asset was used 4,500 hours?

A) $27,000
B) $24,000
C) $22,500
D) $20,000