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 115

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 January 1, 2014, Spencer Corporation signed a contract with the Mid-Rivers Bank for a line of credit that permitted Spencer to borrow up to $50,000. Indicate the effects of signing this contract. $\begin{array}{|l|l|l|l|l|l|}\text { Assets Liabilities } & \text { Equity } & \text { Revenues } & \text { Expenses } & \begin{array}{c}\text { Net } \\\text { Income }\end{array} & \begin{array}{c}\text { Cash } \\\text { Flow }\end{array}\\\hline&&&\end{array}$

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Definitions:

Preindustrial

Refers to societies or economies that exist before the development of industrialization, characterized by agricultural, handicraft, and manual labor-based systems.

Early Industrial

Referring to the period or stage of development where societies transition from agrarian to industrial economic activities.

Positive Checks

Mechanics that increase mortality rate and decrease population size, as per Thomas Malthus, including famine, war, and disease.

Thomas Malthus

An English economist and demographer known for his theory that population growth would outpace agricultural production, leading to widespread famine and hardship.