iater Company operates a small manufacturing facility. On January 1, 2021, an asset account for the company showed the following balances:

Equipment	$ 160,000
Accumulated Depreciation (beginning of the year)	100,000

During the first week of January 2021, the following cash expenditures were incurred for repairs and maintenance:

Routine maintenance and repairs on the equipment	$ 1,850
Major overhaul of the equipment that improved efficiency	24,000

The equipment is being depreciated on a straight-line basis over an estimated life of 15 years with a $10,000 estimated residual value. The annual accounting period ends on December 31.