EXERCISE 8-17A

Exercise 8-17A Effect of revemue expenditures versus capital expenditures on financial statements Sellers Construction Company purchased a compressor for $28,000 cash. It had an estimated useful life of four years and a $4,000 salvage value. At the beginning of the third year of use, the company spent an additional $6.000 related to the equipment. The company's financial condition just prior to this expenditure is shown in the following statements model: Required Record the $6,000 expenditure in the statements model under each of the following independent assumptions: a. The expenditure was for routine maintenance. b. The expenditure extended the compressor's life. c. The expenditure improved the compressor's operating capacity. Exercise 8-17A Effect of revenue expenditures versus capital expenditures on financial statements Sellers Construction Company purchased a compressor for $28.000 cash. It had an estimated usefs life of four years and a $4,000 salvage value. At the beginning of the third year of use, the company spent an additional $6,000 related to the equipment. The company's financial condition just prior to this expenditure is shown in the following statements model: Required Record the $6,000 expenditure in the statements model under each of the following iadependers assumptions: a. The expenditure was for routine maintenance. b. The expenditure extended the compressor's life. c. The expenditure improved the compressor's operating capacity. Exercise 8-17A Effect of revenue expenditures versus capital expenditures on financial statements Sellers Construction Company purchased a compressor for $28,000 cash. It had an estimated useful life of four years and a $4,000 salvage value. At the beginning of the third year of use, the compury spent an additional \$6,000 related to the equipment. The company's financial condition just prior to this expenditure is shown in the following statements model: Required Record the $6.000 expenditure in the statements model under each of the following independent? assumptions: a. The expenditure was for roatine maintenance. b. The expenditure extended the compressor's life. c. The expenditure improved the compressor's operating capacity. Exercise 8-17A Effect of revenue expenditures versus capital expenditures on financial statements Sellers Construction Company purchased a compressor for $28,000 cash. It had an estimated useful life of four years and a $4,000 salvage value. At the beginning of the third year of use, the company spent an additional $6.000 related to the equipment. The company's financial condition just prior to this expenditure is shown in the following statements model: Required Record the $6,000 expenditure in the statements model under each of the following independent assumptions: a. The expenditure was for routine maintenance. b. The expenditure extended the compressor's life. c. The expenditure improved the compressor's operating capacity. Exerclse 17s A. \begin{tabular}{|l|l|l|l|l|l|l|l|} \hline Cash & BookValue & Com Stock & Ret Eam & Revenue & Expense & NetIncome & Cash Flow \\ \hline & & & & & & & \\ \hline & & & & & & & \\ \hline \end{tabular} B. \begin{tabular}{|l|l|l|l|l|l|l|l|} \hline Cash & BookValue & Com Stock & Ret Eam & Revenue & Expense & NetIncome & Cash Flow \\ \hline & & & & & & & \\ \hline & & & & & & & \\ \hline \end{tabular} C. \begin{tabular}{|l|l|l|l|l|l|l|l|} \hline Cash & BookValue & Com Stock & Ret Eam & Revenue & Expense & NetIncome & Cish Flow \\ \hline & & & & & & & \\ \hline & & & & & & & \\ \hline \end{tabular} Exercise 17A: Exercise 8-17A Effect of nevenue expenditures versus capital expenditures on financial statements Sellers Construction Company purchased a compressor for $28,000 cash. It had an estimated useful life of four years and a $4,000 salvage value. At the beginning of the third year of use, the company spent an additional $6,000 related to the equipment. The company's financial condition just prior to this expenditure is shown in the following statements model: Required Record the $6,000 expenditure in the statements model under each of the following independent assumptions: a. The expenditure was for routine maintenance. b. The expenditure extended the compressor's life. c. The expenditure improved the compressor's operating capacity. Exercise 8-17A Effect of revenue expenditures versus capital expenditures on financial statements Sellers Construetion Company purchased a compressor for $28,000 cash. It had an estimated aseful life of four years and a $4,000 salvage value. At the beginning of the third year of use, the company spent an additional $6,000 related to the equipment. The company's financial condition just prior to this expenditure is shown in the following statements model: Required Record the $6,000 expenditure in the statements model under each of the following independent assumptions: a. The expenditure was for routine maintenance. b. The expenditure extended the compressor's life. c. The expenditure improved the compressor's operating capacity. Exercise 8-17A Effect of revenue expenditures werus capital expenditures on financial statements Sellers Construction Company purchased a compressor for $28,000 cash. It had an estimated useful life of four years and a $4,000 salvage value. At the beginning of the third year of use, the company spent an additional \$6,000 related to the equipment. The company's financial condition just prior to this expenditure is shown in the following statements model: Required Record the $6,000 expenditure in the statements model under each of the following independeat assumptions: a. The expenditure was for routine maintenance. b. The expenditure extended the compressor's life. c. The expenditure improved the compressor's operating capacity