Multiple Choice
In the context of the renewable-energy industry, batteries used in production are classified as which type of cost?
114
views
1. Introduction to Accounting
Types of Accounting
Multiple Choice
Which of the following types of accounts typically have a normal credit balance?
A
Expense accounts
B
Revenue accounts
C
Asset accounts
D
Liability accounts
Verified step by step guidance1
Understand the concept of normal balances: In accounting, each type of account has a normal balance, which is the side (debit or credit) that increases the account. For example, assets typically have a normal debit balance, while liabilities and revenues typically have a normal credit balance.
Review the types of accounts: Expense accounts, revenue accounts, asset accounts, and liability accounts are all part of the accounting equation. Each has a specific normal balance based on its role in the equation.
Analyze expense accounts: Expense accounts typically have a normal debit balance because they decrease equity when recorded.
Analyze revenue accounts: Revenue accounts typically have a normal credit balance because they increase equity when recorded.
Analyze asset and liability accounts: Asset accounts typically have a normal debit balance because they represent resources owned by the business. Liability accounts typically have a normal credit balance because they represent obligations owed by the business.
Related Videos
Related Practice
