for each of the following accounts, indicate the effect of a debit or a credit on the account and the normal…
for each of the following accounts, indicate the effect of a debit or a credit on the account and the normal balance.\ndebit effect credit effect normal balance\na. accounts payable.\nb. advertising expense.\nc. service revenue.\nd. accounts receivable.\ne. retained earnings.\nf. dividends.
Answer
Explanation:
Step1: Identify Accounts Payable type
Accounts Payable is a liability. A debit decreases a liability, a credit increases it, and its normal balance is credit.
Step2: Identify Advertising Expense type
Advertising Expense is an expense. A debit increases an expense, a credit decreases it, and its normal balance is debit.
Step3: Identify Service Revenue type
Service Revenue is a revenue. A debit decreases revenue, a credit increases it, and its normal balance is credit.
Step4: Identify Accounts Receivable type
Accounts Receivable is an asset. A debit increases an asset, a credit decreases it, and its normal balance is debit.
Step5: Identify Retained Earnings type
Retained Earnings is an equity - related account. A debit decreases it, a credit increases it, and its normal balance is credit.
Step6: Identify Dividends type
Dividends is an equity - contra account. A debit increases it, a credit decreases it, and its normal balance is debit.
Answer:
a. Debit Effect: Decrease, Credit Effect: Increase, Normal Balance: Credit b. Debit Effect: Increase, Credit Effect: Decrease, Normal Balance: Debit c. Debit Effect: Decrease, Credit Effect: Increase, Normal Balance: Credit d. Debit Effect: Increase, Credit Effect: Decrease, Normal Balance: Debit e. Debit Effect: Decrease, Credit Effect: Increase, Normal Balance: Credit f. Debit Effect: Increase, Credit Effect: Decrease, Normal Balance: Debit