Which one of the following statements regarding the debit/credit processing of revenues and expenses is true?
A)Debits reduce expenses.
B)The total credits recorded in revenue accounts must equal the total debits recorded in expense accounts.
C)Across all revenue accounts,the total value of all debits must equal the total value of all credits.
D)Credits increase revenues.

Question

Quizplus · Accepted Answer

In double-entry accounting, revenues are credited and expenses are debited. This means that credits increase revenues and debits reduce expenses. Therefore, option D is the only true statement among the given options. Option B is incorrect because revenues are credited and expenses are debited, so the total credits in revenue accounts cannot equal the total debits in expense accounts. Option C is incorrect because it suggests that all revenue accounts should have equal debits and credits, which is not a requirement in accounting.

Which One of the Following Statements Regarding the Debit/credit Processing