SUBSEQUENT EXPENDITURES. Pasta, a restaurant specializing in fresh pasta, installed a pasta cooker in early 19x4 at a cost of $11,800. The cooker had an expected life of 5 years and a residual value of $600 when installed. As the restaurant’s business increased, it became apparent that renovations were necessary so that the output of the cooker could be increased. In January 19x7, Pasta spent $8,200 to install new heating equipment and $4,100 to add pressure-cooking capability. After these renovations, Pasta estimated that the remaining useful life of the cooker was 10 years and that the residual value was now $1,500.

REQUIRED:
1. Compute 1 year’s straight-line depreciation on the cooker before the renovations.
2. Compute the capitalized cost of the cooker after the renovations were made.
¢ 3. Assume that 3 full years of straight-line depreciation had been recorded on the cooker before the renovations were made. Compute 1 year’s straight-line depreciation on the renovated cooker.