Champion Contractors completed the following transactions and events involving the purchase and operation of equipment in its business. 2012 Jan. 1 Paid $266,000 cash plus $10,640 in sales tax and $1,700 in transportation (FOB shipping point) for a new loader. The loader is estimated to have a four-year life and a $26,600 salvage value. Loader costs are recorded in the Equipment account. Jan. 3 Paid $5,000 to enclose the cab and install air conditioning in the loader to enable operations under harsher conditions. This increased the estimated salvage value of the loader by another $1,500. Dec.31 Recorded annual straight-line depreciation on the loader. 2013 Jan. 1 Paid $4,300 to overhaul the loader's engine, which increased the loader's estimated useful life by two years. Feb. 17 Paid $1,075 to repair the loader after the operator backed it into a tree. Dec 31 Recorded annual straight-line depreciation on the loader. Required: Prepare journal entries to record these transactions and events.