Indicate How Each Event Affects the Elements of Financial Statements

question 18

Essay

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.You do not need to enter amounts.Enter only one letter for each element.

-On December 31,2016,Warren Co.accrued $625 of interest on a $25,000 note it had issued from the National Bank on July 1,2016.The principal and interest on the note are to be repaid on June 30,2017.How would Warrens's year-end adjustment to accrue the interest on the loan affect its financial statements for 2016?

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Definitions:

Odometer

An odometer is a device used to measure the distance traveled by a vehicle, typically recorded in miles or kilometers.

Duress

Duress involves compelling someone to act against their will by using threats, force, or coercion in the context of making a contract.

Mutual Mistake

A situation in legal contracts where all parties involved have misconceptions about a vital fact at the time of agreement.

Disclaimer

A statement that denies something, especially responsibility.