Generally, asset and expense accounts have a debit normal balance, while liability, equity, and revenue accounts have a credit normal balance. To better understand this concept, let’s break it down further: Debit Normal Balance:Asset accounts such as cash, accounts receivable, and inventory have...
Revenue definition Revenue is the total amount of money a business earns during a given period. This value consists of all sales, profit from investments, and any other amount produced by normal business operations. Revenue may be referred to as the “top line,” referencing where it’s repo...
What type of information is contained in nominal accounts, and what type in real accounts? Explain unearned revenue in your own words. What entry is made to all expense accounts to zero them out? What is the normal balance of the Merchandise Inventory account?
In accounting and bookkeeping, a debit balance is the ending amount found on the left side of a general ledger account or subsidiary ledger account. Examples of Debit Balances A debit balance is normal and expected for the following accounts: Asset accounts such as Cash, Accounts Receivable, In...
Accounts where a credit balance is NOT the normal balance include the following: Asset accounts (other than contra asset accounts such as Allowance for Doubtful Accounts and Accumulated Depreciation) Expense accounts (other than a contra expense account) Contra revenue accounts (such as Sales Discounts...
What is the normal balance of the cost of goods sold? What constitutes a "reasonable" accounts receivable turnover ratio? What is the normal balance of the Delivery Expense account? What is the normal balance dividends of revenue expenses? What is the normal balance for the liabi...
Unearned revenue is recorded on a company’sbalance sheetas a liability. It is treated as a liability because the revenue has still not been earned and represents products or services owed to a customer. As the prepaid service or product is gradually delivered over time, it is recognized as ...
Revenue - Expenses = Profit or loss There are many ways to format a P&L statement, but all versions include the same basic information. Sales are at the top of the statement, while expenses appear below. The profit or loss is the difference between the two. ...
In single-entry accounting, when a business completes a transaction, it records that transaction in only one account. For example, if a business sells a good, the expenses of the good are recorded when it is purchased, and the revenue is recorded when the good is sold. ...
What is ATM? An ATM (Automated Teller Machine) is an electronic banking device that allows customers to perform financial transactions such as cash withdrawals, deposits, balance inquiries, bill payments, or fund transfers without the need for a bank teller or representative. ATMs are typically fou...