Question

For each statement below, indicate whether a debit or credit
is appropriate by clicking in the drop down box to the right
of each statement. Be careful with matching questions because
carmen randomizes the matches. Thus, if you print out the quiz
to work on it and then enter your answers later in the week,
it is very likely the order of the matches will be different.
Therefore, exercise caution when entering your answers into
carmen. Quiz scores will not be adjusted for errors in entering
choices.

Group of answer choices

a decrease to retained earnings

      [ Choose ]            debit            credit      

an increase to notes payable

      [ Choose ]            debit            credit      

a decrease to building

      [ Choose ]            debit            credit      

an increase to cost of goods sold

Answer 1

ANSWER:

1. a decrease in retained earnings - debit

reason: retained earnings comes under owners equity has a credit balance so a decrease indicates a debit

2. an increase in notes payable - credit

reason: Notes payable is a liability and has a credit balance so an increase indicates a credit

3. a decrease to building - credit

reason: Building is an asset and has debit balance so a decrease indicates a credit

4. an increase to cost of goods sold - debit

reason: cost of goods sold is an expense and expense has an debit balance so an increase to cost of goods sold indicates a debit