Problem 8-4A Computing and revising depreciation; revenue and capital expenditures LO C1, C2, C3 Champion Contractors completed the following transactions involving equipment Year 1 Jan. 1 Paid $322,000 cash plus $12,689 in sales tax and $1,900 in transportation (FOS shipping point) for a new loader: The Loader is estimated to have a four-year life and a $32,200 salvage value. Loader costs are recorded in the Equipment account. Jan. 3 Paid $6,000 to install air conditioning in the loader to enable operations under harsher conditions. This increased the estimated salvage value of the loader by another $1,800. Dec. 31 Recorded annual straight-line depreciation on the loader. Year 2 Jan. 1 Paid $4,100 to overhaul the loader's engine, which increased the loader's estimated useful 11fe by two years. Feb. 17 Paid $1,025 for minor repairs to the loader after the operator backed it into a tree. Dec. 31 Recorded annual straight-line depreciation on the loader. Required: Prepare journal entries to record these transactions and events. Journal entry worksheet Paid $6,000 to install air conditioning in the loader to enable operations under harsher conditions. This increased the estimated salvage value of the loader by another $1,800. Note: Enter debits before credits. Date General Journal Debit Credit Jan 3, Year 1 Equipment Cash Record entry Clear entry View general journal Journal entry worksheet Paid $4,100 to overhaul the loader's engine, which increased the loader's estimated useful life by two years. Note: Enter debits before credits. General Journal Debit Credit Date Jan 1. Year 2 Equipment Cash Record entry Clear entry View general journal Journal entry worksheet Paid $1,025 for minor repairs to the loader after the operator backed it into a tree. Note: Enter debits before credits. Date Debit Credit Feb 17. Year 2 General Journal Repairs expense-Equipment Cash Record entry Clear entry View general journal Journal entry worksheet 1 2 3 4 5 6 Recorded annual straight-line depreciation on the loader. Note: Enter debits before credits. Date General Journal Debit Credit Dec 31, Year 2 Depreciation expense-Equipment Accumulated depreciation Equipment Record entry Clear entry View general journal