Question

Which of the following statements regarding debits and credits is always correct? Multiple Choice The total value of all debits to a particular account must equal the total value of all credits to that account. O The total value of all debits recorded in the ledger must equal the total value of all credits recorded in the ledger. Debits decrease accounts while credits increase them. The normal balance for an account is the side on which it decreases.

^answes for question

^multiple choice for that question

Answer 1

1. The normal balance in the account is the side on which it deserves is the correct statement.

Normal balance of each and every account depends on the expected debit and credit balance in that account.

Consider the Accounting equation

Assets = Liabilities + Owner's Equity

Accounts which belong to the right hand side of the accounting equation have a credit balance. Capital A/c has credit balance. Accounts Payable and any liabilities have credit balance.

Similarly accounts belong to the left hand side, ie. assets have debit balance. Equipment, Building, Accounts Recievable have debit balance.

2. Constable Co

TRIAL BALANCE

Particulars	Debit	Credit
Accounts Payable		4570
Accounts Recievable	9420
Common Stock		90700
Equipment	50200
Inventory	30900
Notes Payable due December 31,2023		2570
Retained Earnings December 31,2020		14160
Taxes Payable		3710
Cash	25190
Total	115710	115710

3.

4.

Date Particulars a Accounts Payable Amount Date Particulars Amount 4,670 01/12/2020 Beginning Balance 18,230 11,270 d 3,630 14,770 e 9,530 13,410 f 12,730 b с 31/12/2020 Closing Balance 44,210 44,210

Particulars Equipment Date Particulars Amount Date 01/12/2020 Beginning Balance 124,700 a 14,780 b 38,380 с a d e Amount 6,080 5,880 7,480 12,080 11,280 135,060 f 31/12/2020 Closing Balance 177,860 177,860