Chapter 2, Problem 2.3EYCT

(a)

To determine

Normal Balance: It is that balance of an account that it normally indicates an increase in the value, such as,

• Increase in asset is debited and so the normal balance of asset is debit balance
• Increase in liability is credited and so the normal balance of liability is credit balance
• Increase in stockholder’s equity and so the normal balance of stockholders’ equity is credit balance
• Increase in expense and so the normal balance of expense is debit balance
• Increase in income and so the normal balance of revenue is credit balance

To Identify: (a) Normal balances of accounts and (b) the other account that ordinarily would be involved in given transaction.

(b)(1)

To determine

Identify the other account that ordinarily would be involved.

Accounts Receivable is increased.

(b) (2)

To determine

Interest expense is increased.

(b) (3)

To determine

Salaries and Wages Payable is decreased.

(b) (4)

To determine

Service Revenue is increased.