Indicate How Each Event Affects the Elements of Financial Statements $$\text { Increase } = \mathrm { I } \quad \text { Decrease } = \mathrm { D } \quad \text { No Effect } = \mathrm { N }$$

question 109

Short Answer

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. $$\text { Increase } = \mathrm { I } \quad \text { Decrease } = \mathrm { D } \quad \text { No Effect } = \mathrm { N }$$
On December 31, 2014, Washta Company made the annual payment on a long-term note. The payment included a reduction in the principal balance and payment of interest for the year. Show how this annual payment affected Washta's financial statements. $\begin{array}{|l|l|l|l|l|l|}\text { Assets Liabilities } & \text { Equity } & \text { Revenues } & \text { Expenses } & \begin{array}{c}\text { Net } \\\text { Income }\end{array} & \begin{array}{c}\text { Cash } \\\text { Flow }\end{array}\\\hline&&&\end{array}$

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Definitions:

Technology

The application of scientific knowledge for practical purposes, especially in industry and the development of new products or processes.

Production Possibilities Frontier

A curve depicting all maximum output possibilities for two or more goods given a set of inputs.

Outward Shift

A movement of the supply or demand curve in an economic diagram indicating an increase in supply or demand, leading to changes in price and quantity.

Consumption Level

The total amount of goods and services that an individual or group consumes over a specific period.