Wiater Company operates a small manufacturing facility. On January 1, 2017, an asset account for the company showed the following balances: 

Manufacturing equipment..........................................................$160,000

Accumulated depreciation through 2016....................................110,000

During the first week of January 2017, the following expenditures were incurred for repairs and maintenance: 

Routine maintenance and repairs on the equipment.................21,000 

Major overhaul of the equipment that improved efficiency......$ 1,850  

The equipment is being depreciated on a straight-line basis over an estimated life of fifteen years with a $10,000 estimated residual value. The annual accounting period ends on December 31. 

Required: 

Indicate the effects (accounts, amounts, and + or −) of the following two items on the accounting equation, using the headings shown below. 

1. The adjustment for depreciation made at the end of 2016. 

2. The two expenditures for repairs and maintenance during January 2017 

Transcribed Image Text:

Item Assets Liabilities Shareholders' Equity +