Indicate How Each Event Affects the Elements of Financial Statements

question 77

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.

-Perez Co.paid $220,000 cash in salaries to its employees.

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Definitions:

Financial Statements

Documents that provide an overview of a company's financial condition, including balance sheets, income statements, and cash flow statements.

GAAP

Generally Accepted Accounting Principles; a set of accounting standards and practices used for financial reporting in the U.S.

True Locality Rule

A legal principle ensuring that a case is tried in the jurisdiction where the events in question occurred.

Standard Of Care

The degree of care and caution required by law, which a reasonable person should take in a specific situation.