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 140

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. Assume use of a perpetual inventory system. $$\text { Increase } = \mathrm { I } \quad \text { Decrease } = \mathrm { D } \quad \text { No Effect } = \mathrm { N }$$
Youkilis Company discovered that a recent shipment of merchandise it had purchased was not of good quality. The seller agreed to grant Youkilis an allowance of $500. Youkilis had not yet paid the amount owed for the merchandise. Show how the transaction would affect Youkilis's financial statements. $\begin{array} {| l| l| l| l| l| l| l| }\text { Assets}&\text { Liabilities }&\text {Equity}&\text { Revenues}&\text { Expenses }&\text { Net Income }&\text { Cash }\\\hline &&&&&\end{array}$

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Definitions:

Capability

Refers to the ability or capacity to do something effectively.

Being Believed

The state in which a person's statements or claims are accepted as true by others.

Gestural Computing

Refers to technology interfaces that interpret human gestures as inputs for computer control.

Control Computers

The act of commanding or managing computers and their functions through software or hardware means.