Reference no: EM132490611

Tower Company owned a service truck that was purchased at the beginning of 2018 for $36,000. It had an estimated life of three years and an estimated salvage value of $3,000. Tower company uses straight-line depreciation. Its financial condition as of January 1, 2020, is shown in the following financial statements model.

In 2020, Tower Company spent the following amounts on the truck:

1. Jan. 4 Overhauled the engine for $6,300. The estimated life was extended one additional year, and the salvage value was revised to $2,000.
2.  July 6 Obtained oil change and transmission service, $280.
3.  Aug. 7 Replaced the fan belt and battery, $380. Dec. 31 Purchased gasoline for the year, $7,800.
4.  31 Recognized 2020 depreciation expense.

Problem 1: Record the 2020 transactions in a statements. (In the Cash Flow column, use the initials OA to designate operating activity, IA for investing activity, FA for financing activity, or NC for net change. If the element is not affected, leave the cell blank. Round your answers to the nearest dollar amount. Enter any decreases to account balances with a minus sign.)