Which of the following is true regarding normal balances of accounts?
A) All accounts have a normal debit balance.
B) All expense accounts have a normal negative balance.
C) Accounts that have a normal debit balance will only have debit entries, never credit entries.
D) The normal balance appears on the side of the account that also receives increase entries.

Question

Quizplus · Accepted Answer

The normal balance of an account is the side that is increased when there is an increase entry, and vice versa. Therefore, the best choice is D, which says that the normal balance appears on the side of the account that also receives increase entries. Option A is incorrect because some accounts (like revenue) have a normal credit balance. Option B is incorrect because expense accounts have a normal debit balance. Option C is incorrect because accounts with a normal debit balance can have credit entries when they're reduced.

Which of the Following Is True Regarding Normal Balances of Accounts