Determine the Effect of the Following Transactions on the Financial

question 78

Essay

Determine the effect of the following transactions on the financial statement components identified.Code your answers as follows:
A: If the transaction results in an increase in the financial statement component.
B: If the transaction results in a decrease in the financial statement component.
C.If the transaction does not affect the financial statement component.
Transaction 1: The adjusting entry to record bad debt expense was made.
Gross profit _____
Current assets _____
Stockholders' equity _____
Transaction 2: An account receivable was collected for which the customer took advantage of a 2% discount and remitted the payment less the discount.
Net sales _____
Gross Profit _____
Current assets _____

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Definitions:

Wasted Capacity

Resources or facilities that are underused or not used to their full potential, leading to inefficiency and lost productivity.

Production Margin

The difference between the production cost and the selling price of products, representing the profitability.

Revenue Management

The use of data analytics to forecast consumer demand and optimize product availability and pricing to maximize revenue.

Supply Chain Assets

Resources owned or controlled by a supply chain that contribute to manufacturing, delivering, and selling products, including facilities, equipment, and inventory.