Use the following to answer questions 10?12: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 dollar amounts. (Note that "Not Affected" means that the event does not affect that element of the financial statements or the event causes an increase in that element that is offset by a decrease in the same element.)Increase = IDecrease = DNot Affected = NALandau Company replenished its petty cash fund. The expenditures of the fund included postage, office supplies, and other miscellaneous items. Indicate the effects of recognizing the expenditures on financial statements and the replenishment of the petty cash fund.
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What will be an ideal response?
(D) (NA) (D) (NA) (I) (D) (D)
The combined entries decrease assets (cash) and stockholders' equity (retained earnings). Expenses are increased, which decrease net income. It is reported as a cash outflow for operating activities on the statement of cash flows.
Business
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What will be an ideal response?
(D) (NA) (D) (NA) (I) (D) (D)
The combined entries decrease assets (cash) and stockholders' equity (retained earnings). Expenses are increased, which decrease net income. It is reported as a cash outflow for operating activities on the statement of cash flows.
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