Hello, I need some help figuring out how I am supposed to calculate how much of $26,400 is excludable from Fred's Income for this problem for accounting. I just don't understand what I am supposed to do. Thank you.

Required information Problem 5-62 (LO 5-3) (Algo) [The following information applies to the questions displayed below.] Fred currently earns $10,400 per month. Fred has been offered the chance to transfer for three to five years to an overseas affiliate. His employer is willing to pay Fred $13,400 per month if he accepts the assignment. Assume that the maximum foreignearned income exclusion for next year is $120,000. Problem 5-62 Part a-2 (Algo) a-2. If Fred's employer also provides him free housing abroad (cost of $26,400 ), how much of the $26,400 is excludable from Fred's income