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: Classify Prepaid Insurance

Prepaid Insurance is an asset. Assets increase on the debit - side, decrease on the credit - side and have a normal debit balance.

Step2: Classify Sales

Sales is a revenue account which is part of Owner's Equity. Revenue accounts increase on the credit - side, decrease on the debit - side and have a normal credit balance.

Step3: Classify Supplies

Supplies are assets. Assets increase on the debit - side, decrease on the credit - side and have a normal debit balance.

Step4: Classify Accounts Receivable - Tom Dayton

Accounts Receivable is an asset. Assets increase on the debit - side, decrease on the credit - side and have a normal debit balance.

Step5: Classify Advertising Expense

Advertising Expense is an expense account which is part of Owner's Equity. Expense accounts increase on the debit - side, decrease on the credit - side and have a normal debit balance.

Step6: Classify Cash

Cash is an asset. Assets increase on the debit - side, decrease on the credit - side and have a normal debit balance.

Step7: Classify Barbara Casey, Drawing

Barbara Casey, Drawing is an Owner's Equity contra - account. Owner's Equity contra - accounts increase on the debit - side, decrease on the credit - side and have a normal debit balance.

Step8: Classify Barbara Casey, Capital

Barbara Casey, Capital is an Owner's Equity account. Owner's Equity accounts increase on the credit - side, decrease on the debit - side and have a normal credit balance.

Step9: Classify Accounts Payable - Emmer Supplies

Accounts Payable is a liability. Liabilities increase on the credit - side, decrease on the debit - side and have a normal credit balance.

Answer:

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