es Sellers Construction Company purchased a compressor for $110,800 cash. It had an estimated useful life of four years and a $8,700 salvage value. At the beginning of the third year of use, the company spent an additional $9,510 related to the equipment. The company's financial condition just prior to this expenditure is shown in the horizontal statements model. Required Record the $9,510 expenditure in the statements model under each of the following independent assumptions: (In the Statement of Cash Flows column, use the initials "OA" for operating activities, "FA" for financing activities, and "IA" for investing activity. Enter any decreases to account balances and cash outflows with a minus sign. Not all cells require input.) a. The expenditure was for routine maintenance. b. The expenditure extended the compressor's life. c. The expenditure improved the compressor's operating capacity. Balance a. b. C. Cash Assets 13,620 + + + + Balance Sheet Book Value of Compressor 59,750 = = = SELLERS CONSTRUCTION COMPANY Horizontal Statements Model Stockholders' Equity Common Stock + 23,300 + + + Retained Earnings 50,070 Revenue Income Statement Expenses 11 11 11 || Net Income Statement of Cash Flows

Sellers Construction Company purchased a compressor for $110,800 cash, it had an estimated useful life of four years and a $8,700 salvage value. At the beginning of the third year of use, the company spent an additional $9,510 related to the equipment. The company's financial condition just prior to this expenditure is shown in the horizontal statements model, Required Record the $9,510 expenditure in the statements model under each of the following independent assumptions: (In the Statement of Cash Flows column, use the initials "OA" for operating activities, "FA" for financing activities, and "IA" for investing activity, Enter any decreases to account balances and cash outflows with a minus sign. Not all cells require input.) a. The expenditure was for routine maintenance. b. The expenditure extended the compressor's life. c. The expenditure improved the compressor's operating capacity