Debits and Credits The term ‘debit’ represents the left side of an account and the term ‘credit’ represents the right side of the account. In the accounting process, the increase in cash is recorded as debits and the decrease in cash as credits . Thus, an increase in cash or asset is recorded on the left side and a decrease in cash or liabilities is recorded on the right side of the account. Since, both the sides of the accounting equation (Asset = Liabilities + Stockholders’ Equity ) must be equal, the increase or decrease in liabilities are recorded opposite to increase or decrease in assets. Hence, an increase in liabilities is recorded on the credit side and decrease in liabilities is recorded on the debit side of the account. The normal balance of an account is recorded on the side where an increase in the account is observed. Therefore, the normal balance is recorded on the debit side, if the balance in the debit side exceeds the balance on the credit side and vice-versa. To state: The rules regarding for debit and credit applied in different accounts, such as asset accounts, liability accounts, shareholder’s equity accounts like revenue, expenses, dividend, common stock, and retained earnings .

Question

Want to see the full answer?

Answer 1

Question

Chapter 2, Problem 5Q

To determine

Debits and Credits

The term ‘debit’ represents the left side of an account and the term ‘credit’ represents the right side of the account. In the accounting process, the increase in cash is recorded as debits and the decrease in cash as credits. Thus, an increase in cash or asset is recorded on the left side and a decrease in cash or liabilities is recorded on the right side of the account.

Since, both the sides of the accounting equation (Asset = Liabilities + Stockholders’ Equity) must be equal, the increase or decrease in liabilities are recorded opposite to increase or decrease in assets. Hence, an increase in liabilities is recorded on the credit side and decrease in liabilities is recorded on the debit side of the account.

The normal balance of an account is recorded on the side where an increase in the account is observed. Therefore, the normal balance is recorded on the debit side, if the balance in the debit side exceeds the balance on the credit side and vice-versa.

To state: The rules regarding for debit and credit applied in different accounts, such as asset accounts, liability accounts, shareholder’s equity accounts like revenue, expenses, dividend, common stock, and retained earnings.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Students have asked these similar questions

Can you help me solve this general accounting problem using the correct accounting process?

What was the gain or loss on the disposal?

Please help me solve this general accounting problem with the correct financial process.

Answer 2

Question

Chapter 2, Problem 5Q

To determine

Debits and Credits

The term ‘debit’ represents the left side of an account and the term ‘credit’ represents the right side of the account. In the accounting process, the increase in cash is recorded as debits and the decrease in cash as credits. Thus, an increase in cash or asset is recorded on the left side and a decrease in cash or liabilities is recorded on the right side of the account.

Since, both the sides of the accounting equation (Asset = Liabilities + Stockholders’ Equity) must be equal, the increase or decrease in liabilities are recorded opposite to increase or decrease in assets. Hence, an increase in liabilities is recorded on the credit side and decrease in liabilities is recorded on the debit side of the account.

The normal balance of an account is recorded on the side where an increase in the account is observed. Therefore, the normal balance is recorded on the debit side, if the balance in the debit side exceeds the balance on the credit side and vice-versa.

To state: The rules regarding for debit and credit applied in different accounts, such as asset accounts, liability accounts, shareholder’s equity accounts like revenue, expenses, dividend, common stock, and retained earnings.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 3

Question

Chapter 2, Problem 5Q

To determine

Debits and Credits

The term ‘debit’ represents the left side of an account and the term ‘credit’ represents the right side of the account. In the accounting process, the increase in cash is recorded as debits and the decrease in cash as credits. Thus, an increase in cash or asset is recorded on the left side and a decrease in cash or liabilities is recorded on the right side of the account.

Since, both the sides of the accounting equation (Asset = Liabilities + Stockholders’ Equity) must be equal, the increase or decrease in liabilities are recorded opposite to increase or decrease in assets. Hence, an increase in liabilities is recorded on the credit side and decrease in liabilities is recorded on the debit side of the account.

The normal balance of an account is recorded on the side where an increase in the account is observed. Therefore, the normal balance is recorded on the debit side, if the balance in the debit side exceeds the balance on the credit side and vice-versa.

To state: The rules regarding for debit and credit applied in different accounts, such as asset accounts, liability accounts, shareholder’s equity accounts like revenue, expenses, dividend, common stock, and retained earnings.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 4

Question

Chapter 2, Problem 5Q

To determine

Debits and Credits

The term ‘debit’ represents the left side of an account and the term ‘credit’ represents the right side of the account. In the accounting process, the increase in cash is recorded as debits and the decrease in cash as credits. Thus, an increase in cash or asset is recorded on the left side and a decrease in cash or liabilities is recorded on the right side of the account.

Since, both the sides of the accounting equation (Asset = Liabilities + Stockholders’ Equity) must be equal, the increase or decrease in liabilities are recorded opposite to increase or decrease in assets. Hence, an increase in liabilities is recorded on the credit side and decrease in liabilities is recorded on the debit side of the account.

The normal balance of an account is recorded on the side where an increase in the account is observed. Therefore, the normal balance is recorded on the debit side, if the balance in the debit side exceeds the balance on the credit side and vice-versa.

To state: The rules regarding for debit and credit applied in different accounts, such as asset accounts, liability accounts, shareholder’s equity accounts like revenue, expenses, dividend, common stock, and retained earnings.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 5

Chapter 2, Problem 5Q

To determine

Debits and Credits

The term ‘debit’ represents the left side of an account and the term ‘credit’ represents the right side of the account. In the accounting process, the increase in cash is recorded as debits and the decrease in cash as credits. Thus, an increase in cash or asset is recorded on the left side and a decrease in cash or liabilities is recorded on the right side of the account.

Since, both the sides of the accounting equation (Asset = Liabilities + Stockholders’ Equity) must be equal, the increase or decrease in liabilities are recorded opposite to increase or decrease in assets. Hence, an increase in liabilities is recorded on the credit side and decrease in liabilities is recorded on the debit side of the account.

The normal balance of an account is recorded on the side where an increase in the account is observed. Therefore, the normal balance is recorded on the debit side, if the balance in the debit side exceeds the balance on the credit side and vice-versa.

To state: The rules regarding for debit and credit applied in different accounts, such as asset accounts, liability accounts, shareholder’s equity accounts like revenue, expenses, dividend, common stock, and retained earnings.

Answer 6

Chapter 2, Problem 5Q

To determine

Debits and Credits

The term ‘debit’ represents the left side of an account and the term ‘credit’ represents the right side of the account. In the accounting process, the increase in cash is recorded as debits and the decrease in cash as credits. Thus, an increase in cash or asset is recorded on the left side and a decrease in cash or liabilities is recorded on the right side of the account.

Since, both the sides of the accounting equation (Asset = Liabilities + Stockholders’ Equity) must be equal, the increase or decrease in liabilities are recorded opposite to increase or decrease in assets. Hence, an increase in liabilities is recorded on the credit side and decrease in liabilities is recorded on the debit side of the account.

The normal balance of an account is recorded on the side where an increase in the account is observed. Therefore, the normal balance is recorded on the debit side, if the balance in the debit side exceeds the balance on the credit side and vice-versa.

To state: The rules regarding for debit and credit applied in different accounts, such as asset accounts, liability accounts, shareholder’s equity accounts like revenue, expenses, dividend, common stock, and retained earnings.

Answer 7

Chapter 2, Problem 5Q

To determine

Debits and Credits

The term ‘debit’ represents the left side of an account and the term ‘credit’ represents the right side of the account. In the accounting process, the increase in cash is recorded as debits and the decrease in cash as credits. Thus, an increase in cash or asset is recorded on the left side and a decrease in cash or liabilities is recorded on the right side of the account.

Since, both the sides of the accounting equation (Asset = Liabilities + Stockholders’ Equity) must be equal, the increase or decrease in liabilities are recorded opposite to increase or decrease in assets. Hence, an increase in liabilities is recorded on the credit side and decrease in liabilities is recorded on the debit side of the account.

The normal balance of an account is recorded on the side where an increase in the account is observed. Therefore, the normal balance is recorded on the debit side, if the balance in the debit side exceeds the balance on the credit side and vice-versa.

To state: The rules regarding for debit and credit applied in different accounts, such as asset accounts, liability accounts, shareholder’s equity accounts like revenue, expenses, dividend, common stock, and retained earnings.

Answer 8

Expert Solution & Answer

Answer 9

Expert Solution & Answer

Answer 10

Want to see the full answer?

Check out a sample textbook solution

See solution

Answer 11

Ch. 2 - Prob. 1Q Ch. 2 - Prob. 2Q Ch. 2 - 3. Tom Dingel, a fellow student contends that the...Ch. 2 - 4. Olga Conrad, a beginning accounting student,...Ch. 2 - Prob. 5Q Ch. 2 - Prob. 6Q Ch. 2 - 7. Indicate whether each of the following accounts...Ch. 2 - Prob. 8Q Ch. 2 - 9. Indicate whether the following accounts...Ch. 2 - Prob. 10Q

Videos

Want to see the full answer?

Chapter 2 Solutions