E9-4 (Algo) Recording Straight-Line Depreciation and Repairs [LO 9-2, LO 9-3] Wlater 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) $ 250, eee 114,000 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 $ 3,50 36,000 The equipment is being depreciated on a straight-line basis over an estimated life of 10 years with a $22,000 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, Llabilities 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. * Answer is complete but not entirely correct. Item Assets Liabilities 2020 x 22.800) x Equipment Cash Cash Stockholders' Equity Retained arnings Retained Earnings 2021 * O * (3.050) X (22.800) X (3.050) X = 2021 X (36.000)