Question

Indicate with an “X” whether each account total should be extended to the income statement debit or credit or to the balance sheet debit or credit columns on the work sheet.

balaiice Sheet Debit CreditDebit Cash Accounts Receivable Supplies Prepaid Insurance Automobile Accum. Depr-Automobile Accounts Payable Wages Payable Owner, Capital Owner, Drawing Service Fees Wages Expense Supplies Expense Utilities Expense Insurance Expense Depr. Exp.-Automobile ANALYSIS OF NET INCOME OR NET LOSS ON THE WORK SHEET Inser dollar amounts where the net income or net loss would appear on the work shee Income Statement Balance Shee Debit Credit Debit C Net Inen

Answer 1

Answer

• Accounts are shown in Income Statement or Balance Sheet based on their nature of account and normal balances.
• Normally, these are classified as:

Income Statement		Balance Sheet
Debit	Credit	Debit	Credit
Expenses	Revenues	Asset	Contra Asset
		Contra Liability	Liabilities
		Contra Equity	Equity

• Answer, based on above

		Income Statement		Balance Sheet
	Nature of Account	Debit	Credit	Debit	Credit
Cash	Asset			X
Accounts receivables	Asset			X
Supplies	Asset			X
Prepaid Insurance	Asset			X
Automobile	Asset			X
Accumulated Depreciation Automobile	Contra Asset				X
Accounts payable	Liability				X
Wages payable	Liability				X
Owner' Capital	Equity				X
Owner' Drawings	Contra Equity			X
Service Fees	Revenue		X
Wages Expenses	Expense	X
Supplies expenses	Expense	X
Utilities expense	Expense	X
Insurance expense	Expense	X
Depreciation expense - Automobile	Expense	X