Effect of accounting events on financial statements

Required

Use a horizontal statements model to indicate how each of the following independent accounting events affects the elements of the balance sheet and the income statement. Indicate whether the event increases (I), decreases (D), or does not affect (NA) each element of the statements. The first two transactions are shown as examples.

a. Paid cash to purchase raw materials.

b. Recorded cash sales revenue.

c. Paid cash for actual manufacturing overhead cost

d. Closed the Manufacturing Overhead account when overhead was overapplied.

e. Transferred cost of completed inventory to finished goods.

f. Paid cash for wages of production workers.

g. Paid cash for salaries of selling and administrative personnel.

h. Recorded adjusting entry to recognize amount of manufacturing supplies used (the company uses the periodic inventory method to account for manufacturing supplies).

Transcribed Image Text:

Balance Sheet Income Statement Event No. Exp. Assets = Liab. + C. Stk + Ret Ear. Net Inc. Rev. NA NA NA ID a. NA NA NA NA NA b. NA