Question

Review the T accounts presented in Chapter 3.

1.   What do you think of when you hear the word debit? What do you think of when you hear the word credit?

2.   What does our textbook say about debits and credits?

3.   How would you describe the left and right side of each type of Balance Sheet Account and Income Statement Account?

4.   Our eBook describes how to calculate an account balance. Can you describe this process for the Cash account in your own words? How is this process different for a Liability or Owner’s Equity Account?

5.   What does the term ‘normal balance’ mean?

Answer 1

As per HOMEWORKLIB RULES we are allowed to answer only 4 questions in a single question. Re-upload the remaining questions.

1. The word debit to me means an increase in the asset account and the increase in any income related nominal account. The word credit means to me means, increase in any liability related account and expense accounts.
2. Books define debit as a either increase in asset or expense account or decrease in liability or income account and the same for credit but vice versa.
3. Left side of balance sheet is liabilities and right side is assets. Whereas left side of balance sheet is expenses and right side is incomes.
4. The method of calculation of account balance is the balancing figure. Calculate the totals of both the sides, ascertain the side with high balance and deduct that from low balance side then you will arrive at the account balance.