Chapter 3, Problem 1.1SRQ

Increases are recorded on which side of asset, liability, and owner’s equity accounts?

To determine

Mention the side of the asset, liability and owner’s equity account in which the increases are recorded.

Explanation of Solution

Guidelines for debit and credit

For all increase in assets, expenses and losses and all decrease in liabilities, owners’ equities, it is debited.

For all increase in liabilities, owners’ equities and decrease in assets, expenses and losses, it is credited.

The side of the asset account in which increases are recorded is as shown below:

Assets
Debit (+)	Credit (-)
Increase (Normal balance)	Decreases

Table (1)

The side of the liability account in which increases are recorded is as shown below:

Liabilities
Debit (-)	Credit (+)
Decrease	Increases (Normal balance)

Table (2)

The side of the owner’s equity account in which increases are recorded is as shown below:

Owner’s Equity
Debit (-)	Credit (+)
Decrease	Increases (Normal balance)

Table (3)