Wiater Company operates a small manufacturing facility. On January 1, 2021, an asset account for the company showed the following balances: Equipment $ 231,000 Accumulated Depreciation (beginning of the year) 109,500 During the first week of January 2021, the following cash expenditures were incurred for repairs and maintenance: Routine maintenance and repairs on the equipment Major overhaul of the equipment that improved efficiency $2,050 26,000 The equipment is being depreciated on a straight-line basis over an estimated life of 20 years with a $12.000 estimated residual value. The annual accounting period ends on December 31. Required: Indicate the effects (accounts, amounts, and+for increase and for decrease) of the following two items on the accounting equation using the headings shown below. (Enter any decreases to Assets, Liabilities or Stockholder's Equity with a minus sign.) 1. The adjustment for depreciation made last year at the end of 2020, 2. The two expenditures for repairs and maintenance during January 2021.

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Wister Company operates a small manufacturing facility. On January 1, 2021, an asset account for the company showed the following
balances:
Equipment
Accumulated Depreciation (beginning of the year)
During the first week of January 2021, the following cash expenditures were incurred for repairs and maintenance:
Routine maintenance and repairs on the equipment
Major overhaul of the equipment that improved efficiency
The equipment is being depreciated on a straight-line basis over an estimated life of 20 years with a $12.000 estimated residual
value. The annual accounting period ends on December 31.
Required:
Indicate the effects (accounts, amounts, and+for increase and for decrease) of the following two items on the accounting equation,
using the headings shown below. (Enter any decreases to Assets, Liabilities or Stockholder's Equity with a minus sign.)
1. The adjustment for depreciation made last year at the end of 2020.
2. The two expenditures for repairs and maintenance during January 2021.
Show Transcribed Text
$ 231,000
109,500
Item
2020
2021
2021
G
$2,050
26,000
Required:
Indicate the effects (accounts, amounts, and+for increase and - for decrease) of the following two items on the acc
using the headings shown below. (Enter any decreases to Assets, Liabilities or Stockholder's Equity with a minus
Assets
C
1. The adjustment for depreciation made last year at the end of 2020.
2. The two expenditures for repairs and maintenance during January 2021.
Liabilities
Transcribed Image Text:Wister Company operates a small manufacturing facility. On January 1, 2021, an asset account for the company showed the following balances: Equipment Accumulated Depreciation (beginning of the year) During the first week of January 2021, the following cash expenditures were incurred for repairs and maintenance: Routine maintenance and repairs on the equipment Major overhaul of the equipment that improved efficiency The equipment is being depreciated on a straight-line basis over an estimated life of 20 years with a $12.000 estimated residual value. The annual accounting period ends on December 31. Required: Indicate the effects (accounts, amounts, and+for increase and for decrease) of the following two items on the accounting equation, using the headings shown below. (Enter any decreases to Assets, Liabilities or Stockholder's Equity with a minus sign.) 1. The adjustment for depreciation made last year at the end of 2020. 2. The two expenditures for repairs and maintenance during January 2021. Show Transcribed Text $ 231,000 109,500 Item 2020 2021 2021 G $2,050 26,000 Required: Indicate the effects (accounts, amounts, and+for increase and - for decrease) of the following two items on the acc using the headings shown below. (Enter any decreases to Assets, Liabilities or Stockholder's Equity with a minus Assets C 1. The adjustment for depreciation made last year at the end of 2020. 2. The two expenditures for repairs and maintenance during January 2021. Liabilities
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