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 4

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. $\text { Increase }=\mathrm{I} \quad \text { Decrease }=\mathrm{D} \quad \text { No Effect }=\mathrm{N}$
Sparta Co. provided $1,600 of services for a customer who paid $1,000 cash immediately and promised to pay an additional $600 one month later. $\begin{array} {| l| l| l| l| l| l| l| }\text { Assets}&\text { Liabilities }&\text {Equity}&\text { Revenues}&\text { Expenses }&\text { Net Income }&\text { Cash }\\\hline &&&&&\end{array}$

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Definitions:

Contract Involved

Relates to situations or disputes where a formal agreement between parties, outlining duties, rights, and obligations, is central to the matter at hand.

Types of Fraud

Categories of deceitful activities intended to gain dishonest advantages, often financial in nature.

Effect

The result or outcome of a particular cause or action.

Fraudulent Misrepresentation

The act of deliberately misleading or deceiving another party with false statements or information, leading to their detriment on reliance of such misrepresentation.