Sellers Construction Company purchased a compressor for $116,600 cash. It had an estimated useful life of four years and a $9,400 salvage value. At the beginning of the third year of use, the company spent an additional $6,700 related to the equipment. The company's financial condition just prior to this expenditure is shown in the following statements model. Rev. Exp. - Net Inc. Cash Flow Cash + Assets Book Value of Compressor 63,000 Equity Com. Stk. + Ret. Earn. 22,100 52,800 11,900 + NA NA NA NA Required Record the $6,700 expenditure in the statements model under each of the following independent assumptions: (In the Cash Flow column, use the initials OA for operating activities, FA for financing activities, or IA for investing activity. If there is no effect on the Cash Flow, leave the cell blank. Enter any decreases to account balances with a minus sign.) a. The expenditure was for routine maintenance. b. The expenditure extended the compressor's life. c. The expenditure improved the compressor's operating capacity. Stockholders' Equity Revenue Expenses = Net Income Cash Flow Assets Book Value Cash of Compressor 11,900 + 63,000 = Common Stock Retained Earnings 22,100 + 52,800 - a. + + b. + + = C. + +