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 86

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. $\text { Increase }=\mathrm{I} \quad \text { Decrease }=\mathrm{D} \quad \text { No Effect }=\mathrm{N}$
After a physical count of its inventory, Rand Co. discovered that $5,000 of inventory was missing. Show how the required write-down of inventory would affect Rand'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:

Sociological Issues

Social problems or conditions that affect individuals, groups, or entire societies, often requiring intervention to resolve.

Rosa Luxemburg

A Polish Marxist theorist, philosopher, economist, anti-war activist, and revolutionary socialist.

Social Contract

A theoretical agreement within society where individuals consent to surrender some freedoms for the protection and benefit of the community as a whole.

Rousseau

Jean-Jacques Rousseau, an influential 18th-century philosopher known for his ideas on education, society, and government, emphasizing natural human goodness and freedom.