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Champion Contractors completed the following transactions involving equipment. Year 1 January 1 Paid $270,000 cash plus $10,800 in sales tax and $1,600 in transportation (FOB

Champion Contractors completed the following transactions involving equipment. Year 1

January 1 Paid $270,000 cash plus $10,800 in sales tax and $1,600 in transportation (FOB shipping point) for a new loader. The loader is estimated to have a four-year life and a $27,000 salvage value. Loader costs are recorded in the Equipment account.
January 3 Paid $3,000 to install air conditioning in the loader to enable operations under harsher conditions. This increased the estimated salvage value of the loader by another $900.
December 31 Recorded annual straight-line depreciation on the loader.

Year 2

January 1 Paid $4,200 to overhaul the loaders engine, which increased the loaders estimated useful life by two years.
February 17 Paid $1,050 for minor repairs to the loader after the operator backed it into a tree.
December 31 Recorded annual straight-line depreciation on the loader.

Required: Prepare journal entries to record these transactions and events.

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