INS. 1. Asset accounts normally have balances. An increase in asset is recorded as a while decrease in asset is recorded as a 2. Liability accounts normally have balances. An increase in liability is recorded by a and a decrease is entered as a 3. The owner's capital account normally has a balance. This account increases on the side and decreases on the side. 4. Income accounts normally have and decrease on the balances. These accounts increase on the side side. 5. Expense accounts normally have and decrease on the balances. These accounts increase on the side side.

INS. 1. Asset accounts normally have balances. An increase in asset is recorded as a while decrease in asset is recorded as a 2. Liability accounts normally have balances. An increase in liability is recorded by a and a decrease is entered as a 3. The owner's capital account normally has a balance. This account increases on the side and decreases on the side. 4. Income accounts normally have and decrease on the balances. These accounts increase on the side side. 5. Expense accounts normally have and decrease on the balances. These accounts increase on the side side.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Bookkeeping

Bookkeeping is the process of recording the financial transactions of a company on a regular basis. With the process of bookkeeping, companies can track important financial information that helps management in making crucial decisions.

Question

100%

EXERCISE 2.1
Test 1. Fill in the blanks. The account types determine how increases or decreases in it are recorded. Determine whether
the word debit or credit is appropriate for each statement. Write debit or credit on the blanks.
1.
Asset accounts normally have
balances. An increase in asset is recorded as a
while decrease in asset is recorded as a
2. Liability accounts normally have
balances. An increase in liability is recorded by a
and a decrease is entered as a
3. The owner's capital account normally has a
balance. This account increases on the
side and decreases on the
side.
Income accounts normally have
and decrease on the
4.
balances. These accounts increase on the
side
side.
5. Expense accounts normally have
and decrease on the
balances. These accounts increase on the
side
side.

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