For questions 1 through 6:Indicate how each event affects the financial statements model. Use the following letters to record your answer in the box shown below each element. You do not need to enter amounts.Increase = I Decrease = D No Effect = NA(Note that "No Effect" means that the event does not affect that element of the financial statements or that the event causes an increase in that element, which is offset by a decrease in that same element.)Todd Co. collected $2,000 cash from customers in partial settlement of its accounts receivable.AssetsLiabilitiesEquityRevenuesExpensesNet IncomeStmt of Cash Flows???????
What will be an ideal response?
(NA) (NA) (NA) (NA) (NA) (NA) (I)
Collecting on accounts receivable increases one asset (cash) and decreases another asset (accounts receivable). It does not affect the income statement, but is reported as a cash inflow for operating activities on the statement of cash flows.
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At steady state
a. ?1(n+1) > ?1(n) b. ?1 = ?2 c. ?1 + ?2 ? 1 d. ?1(n+1) = ?1
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