Indicate how each event affects the elements of financial statements. Use the following letters to record your answer in the box shown below each element. If an event increases one account and decreases another account equally within the same element (such as an asset exchange event), record I/D. If an event has no impact on the element, record NA. You do not need to enter amounts. Assume that Whetzel Company uses a perpetual inventory system.Increase = I Decrease = D Not Affected = NAWhetzel Company sold merchandise to a customer for $950 on account. Whetzel's cost of the merchandise was $600.
Definitions:
Transaction Errors
Mistakes or inaccuracies occurring in the recording, processing, or reporting of financial transactions.
Debit
Amount entered on the left side of an account.
Credit
In financial terms, credit is the ability to borrow money or access goods or services with the understanding that payment will be made in the future.
Adjusting Journal Entry
A record created at the conclusion of a financial period to distribute revenues and expenses to their relevant period.
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