3. part three—determining the normal balance, increase, and decrease sides for accounts\ndo the following…

3. part three—determining the normal balance, increase, and decrease sides for accounts\ndo the following for each account: 1. select the account classification in column 2 (asset, liability, owner’s equity) 2. select either debit or credit (columns 3 and 4) to indicate the increase side of the account. 3. select either debit or credit (columns 5 and 6) to indicate the decrease side of the account. 4. select either debit or credit (columns 7 and 8) to indicate the normal balance of the account.\n| 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |\n|--|--|--|--|--|--|--|--| \n| account | account classification | increase side | | decrease side | | account’s normal balance | |\n| | | debit | credit | debit | credit | debit | credit |\n| prepaid insurance | | | | | | | |\n| sales | | | | | | | |\n| supplies | | | | | | | |\n| accounts receivable - tom dayton | | | | | | | |\n| advertising expense | | | | | | | |\n| cash | | | | | | | |\n| barbara casey, drawing | | | | | | | |\n| barbara casey, capital | | | | | | | |\n| accounts payable - emmer supplies | | | | | | | |

3. part three—determining the normal balance, increase, and decrease sides for accounts\ndo the following for each account: 1. select the account classification in column 2 (asset, liability, owner’s equity) 2. select either debit or credit (columns 3 and 4) to indicate the increase side of the account. 3. select either debit or credit (columns 5 and 6) to indicate the decrease side of the account. 4. select either debit or credit (columns 7 and 8) to indicate the normal balance of the account.\n| 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 |\n|--|--|--|--|--|--|--|--| \n| account | account classification | increase side | | decrease side | | account’s normal balance | |\n| | | debit | credit | debit | credit | debit | credit |\n| prepaid insurance | | | | | | | |\n| sales | | | | | | | |\n| supplies | | | | | | | |\n| accounts receivable - tom dayton | | | | | | | |\n| advertising expense | | | | | | | |\n| cash | | | | | | | |\n| barbara casey, drawing | | | | | | | |\n| barbara casey, capital | | | | | | | |\n| accounts payable - emmer supplies | | | | | | | |

Answer

Explanation:

Step1: Recall accounting rules

Assets increase on debit side, decrease on credit side and have a normal debit balance. Liabilities and Owner's Equity increase on credit side, decrease on debit side and have a normal credit balance. Revenue (like Sales) increases on credit side, decreases on debit side and has a normal credit balance. Expenses (like Advertising Expense) increase on debit side, decrease on credit side and have a normal debit balance. Owner's drawing (Barbara Casey, Drawing) decreases Owner's Equity, increases on debit side, decreases on credit side and has a normal debit balance.

Step2: Classify and fill - in for Prepaid Insurance

Prepaid Insurance is an asset. So, Account Classification: Asset; Increase Side: Debit; Decrease Side: Credit; Normal Balance: Debit.

Step3: Classify and fill - in for Sales

Sales is a revenue account. So, Account Classification: Owner's Equity (Revenue part); Increase Side: Credit; Decrease Side: Debit; Normal Balance: Credit.

Step4: Classify and fill - in for Supplies

Supplies is an asset. So, Account Classification: Asset; Increase Side: Debit; Decrease Side: Credit; Normal Balance: Debit.

Step5: Classify and fill - in for Accounts Receivable - Tom Dayton

Accounts Receivable is an asset. So, Account Classification: Asset; Increase Side: Debit; Decrease Side: Credit; Normal Balance: Debit.

Step6: Classify and fill - in for Advertising Expense

Advertising Expense is an expense. So, Account Classification: Owner's Equity (Expense part); Increase Side: Debit; Decrease Side: Credit; Normal Balance: Debit.

Step7: Classify and fill - in for Cash

Cash is an asset. So, Account Classification: Asset; Increase Side: Debit; Decrease Side: Credit; Normal Balance: Debit.

Step8: Classify and fill - in for Barbara Casey, Drawing

Barbara Casey, Drawing is an Owner's drawing account. So, Account Classification: Owner's Equity (Drawing part); Increase Side: Debit; Decrease Side: Credit; Normal Balance: Debit.

Step9: Classify and fill - in for Barbara Casey, Capital

Barbara Casey, Capital is an Owner's Equity account. So, Account Classification: Owner's Equity; Increase Side: Credit; Decrease Side: Debit; Normal Balance: Credit.

Step10: Classify and fill - in for Accounts Payable - Emmer Supplies

Accounts Payable is a liability. So, Account Classification: Liability; Increase Side: Credit; Decrease Side: Debit; Normal Balance: Credit.

Answer:

Account Account Classification Increase Side Decrease Side Account's Normal Balance
Prepaid Insurance Asset Debit Credit Debit
Sales Owner's Equity (Revenue part) Credit Debit Credit
Supplies Asset Debit Credit Debit
Accounts Receivable - Tom Dayton Asset Debit Credit Debit
Advertising Expense Owner's Equity (Expense part) Debit Credit Debit
Cash Asset Debit Credit Debit
Barbara Casey, Drawing Owner's Equity (Drawing part) Debit Credit Debit
Barbara Casey, Capital Owner's Equity Credit Debit Credit
Accounts Payable - Emmer Supplies Liability Credit Debit Credit