Part 3 of 4 Required information Assets 0.96 points Debit for Credit for Increases decreases + Normal = Liabilities Debit for Credit for decreases Increases + - Normal Knowledge Check 01 Indicate how to increase each of the accounts listed below. Items Item #1 Cash Item #2 Accounts Payable Item #3 Supplies Item #4 Accounts Receivable + Equity Debit for Credit for decreases Increases - + Normal
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To increase the Accounts Payable account, you would credit it. Show more…
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Normal Balances of Accounts Assets: Any Asset - DEBIT Liabilities: Any Liability - CREDIT Owners' Equity/Stockholders' Equity - CREDIT Any Revenue - CREDIT Any Expense - DEBIT A record that summarizes all the transactions pertaining to a single item in the accounting equation is called an account. Understanding the concept of Normal Balance is the key to preparing journal entries correctly. Define Normal Balance: Transaction: Purchase $5000 equipment with cash - What is the normal balance of the "Equipment" account? How would you increase the Equipment Account? (Debit or Credit?) What is the normal balance of the "Cash" Account? How would you decrease the Cash Account? (Debit or Credit?) Resulting Journal Entry?
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Review the transactions and determine the accounts, the account types (use assets, liabilities, common stock, dividends, revenue, and expenses), if they increase/decrease and if they are DR/CR. List accounts in the order they would be in the journal entry.
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Increases and decreases in various types of accounts are listed below. In each case, indicate by "Dr." or "Cr." (a) whether the change in the account would be recorded as a debit or a credit and (b) whether the normal balance of the account is a debit or a credit. (a) (b) Recorded As Normal Balance 1. Increase in Common Stock 2. Increase in Dividends 3. Decrease in Accounts Receivable 4. Increase in Note Payable 5. Increase in Accounts Payable 6. Decrease in Supplies 7. Decrease in Salaries Expense 8. Increase in Accounts Receivable 9. Increase in Cash 10. Decrease in Land
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