Identify which financial statement elements apply to each item described below. The first one is done as an example. Item Financial Statement Element for Account to be Debited Financial Statement Element for Account to be Credited A cash dividend is declared and paid to shareholders. Equity Current Assets Cash is used to purchase a machine that will be used in the production process over the next five years. Answer 1 Question 3 Answer 2 Question 3 Income taxes are calculated based on a companys profit. The taxes will be paid next year. Answer 3 Question 3 Answer 4 Question 3 A shareholder invests money in a business in exchange for issued shares. Answer 5 Question 3 Answer 6 Question 3 An insurance settlement is received for a fully depreciated asset that was destroyed in a fire. Answer 7 Question 3 Answer 8 Question 3 An allowance for doubtful accounts is established based on estimates of future uncollectible accounts. Answer 9 Question 3 Question 3