Tower Company owned a service truck that was purchased at the beginning of 2016 for $32,000. It had an estimated life of three years and an estimated salvage value of $5,000. Tower Company uses straight-line depreciation. Its financial condition as of January 1, 2018, is shown in the following financial statements model:

Assets

=

Equity

Rev.

Exp.

=

Net Inc.

Cash Flow

Cash

+

Book Value of Truck.

=

Com. Stk.

+

Ret. Earn.

21,000

+

14,000

=

10,000

+

25,000

NA

NA

=

NA

NA

In 2018, Tower Company spent the following amounts on the truck:

Jan. 4	Overhauled the engine for $6,100. The estimated life was extended one additional year, and the salvage value was revised to $4,000.
July 6	Obtained oil change and transmission service, $260.
Aug. 7	Replaced the fan belt and battery, $360.
Dec. 31	Purchased gasoline for the year, $7,600.
	Recognized 2018 depreciation expense.

Required

a.	Record the 2018 transactions in a statements model like the preceding one. (In the Cash Flow column, use the initials OA to designate operating activity, IA for investing activity, FA for financing activity, NC for net change and NA for not affected. Round your answers to the nearest dollar amount. Enter any decreases to account balances with a minus sign.)
	TOWER COMPANY Statements Model for 2018 Assets = Stockholders Equity Revenue Expense = Net Income Cash Flow No Cash + Book Value of Truck = Common Stock + Retained Earnings = Balance 21,000 + 14,000 = 10,000 + 25,000 = NA 1/4 + = + = 7/6 + = + = 8/7 + = + = 12/31 12/31 Total 21,000 + 14,000 = 10,000 + 25,000 0 0 = 0 0

b.	Prepare journal entries for the 2018 transactions. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)
	1. Overhauled the engine for $6,100. The estimated life was extended one additional year, and the salvage value was revised to $4,000. 2.Obtained oil change and transmission service, $260. 3. Date General Journal Debit Credit Jan 04 *Enter debits bef