Indicate How Each Event Affects the Elements of Financial Statements

question 106

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

-On November 1,2016,Gable Company accepted a credit card as payment for $1,500 of services rendered to one of its customers.Assume the credit card fee of 3% is recorded on the date of the sale.Show the effect of this transaction on Gable's financial statements.

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Definitions:

Scarcity

The basic economic problem that arises because people have unlimited wants but resources are limited, necessitating the allocation of resources.

Unlimited Resources

Access to an infinite amount of materials or assets without any constraints.

Human Wants

The desires and needs of individuals for goods, services, and other intangibles that lead to satisfaction.

Opportunity Cost

The toll taken for not picking the second highest preference when decisions are formulated.