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

question 95

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. $\begin{array}{lll}\text { Increase }=\mathrm{I} & \text { Decrease }=\mathrm{D} & \text { No Effect }=\mathrm{N}\end{array}$
Aztec Co. signed contracts for $20,000 of services to be performed in the future. $\begin{array} {| l| l| l| l| l| l| l| }\text { Assets}&\text { Liabilities }&\text {Equity}&\text { Revenues}&\text { Expenses }&\text { Net Income }&\text { Cash }\\\hline &&&&&\end{array}$

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Definitions:

Direct Labor Budget

A financial plan that estimates the cost of the labor needed to meet production goals, including wages and hours.

Manufacturing Overhead Budget

A financial plan that estimates the costs of indirect materials, labor, and other expenses needed to operate a manufacturing facility.

Production Units

A measure of output from a production process, with one unit representing an item or a defined amount of service produced.

Unit Sales

The total number of individual items or units that a company has sold within a particular period.