Which of the following accounts normally has a credit balance?
A)Cash
B)Dividends declared
C)Insurance expense
D)Retained earnings

Question

Quizplus · Accepted Answer

Retained earnings is a cumulative account that tracks the net income or net loss of a company over time. Since net income is credited and net loss is debited, the balance of retained earnings is normally a credit balance. A positive credit balance indicates that the company has earned more than it has distributed in dividends, while a negative balance indicates the opposite.

Which of the Following Accounts Normally Has a Credit Balance