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 94

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, Stuart Co. estimated it had $8,000 of uncollectible accounts related to credit sales it made during the year. Stuart, which uses the allowance method, made the proper adjusting entry on this date. Indicate the effects of the adjusting entry.

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Definitions:

Linear Trend Extrapolation

A forecasting method that uses historical data to predict future outcomes by fitting the data into a linear equation and projecting it forward.

Trend Extrapolation

The analytical process of using historical data to make predictions or forecasts about future trends.

Semantic Differential Scale

A survey or questionnaire tool that measures the meaning or connotations of a concept by using a series of bipolar adjectives.

Likert Scale

A psychometric scale commonly involved in research that employs questionnaires, often used to measure attitudes or opinions with a degree of agreement or disagreement.