Indicate How Each Event Affects the Horizontal Financial Statements Model

question 193

Essay

Indicate how each event affects the horizontal financial statements model. Use the following letters to record your answer in the box shown below. If an event increases one account and decreases another account equally within the same element, record I/D. If an event has no impact on the element, record NA. You do not need to enter amounts.Increase = I Decrease = D Not Affected = NAPearl Company sold merchandise to a customer for $800 cash in a state where the sales tax rate is 5%. (Ignore the effect of cost of goods sold.)

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Definitions:

High Explosives

Substances that detonate, decomposing extremely rapidly and producing a shock wave with high energy output.

Initiate

To begin or start a process or action.

Plastic Explosive

A versatile form of explosive material that is moldable and can be shaped to control the direction and force of the explosion.