Which of the following accounts normally carries a debit balance?

Which of the following accounts normally carries a debit balance?

• A. Accounts receivable
• B. Notes payable
• C. Expenses
• D. Accounts payable

Answer: (A)

In double-entry accounting, asset and expense accounts normally carry debit balances because increases are recorded on the left side. Accounts receivable is an asset, so it increases with a debit entry and thus has a normal debit balance. For example, when a sale is made on credit, you debit accounts receivable and credit sales revenue; when a customer pays, you credit accounts receivable to reduce it. The other options are liabilities or related to costs. Notes payable and accounts payable are liabilities and normally carry credit balances, since increases are recorded on the right. Expenses also typically have debit balances because they increase costs, but the clear illustration among these choices of a normal debit-balance asset is accounts receivable.

In double-entry accounting, asset and expense accounts normally carry debit balances because increases are recorded on the left side. Accounts receivable is an asset, so it increases with a debit entry and thus has a normal debit balance. For example, when a sale is made on credit, you debit accounts receivable and credit sales revenue; when a customer pays, you credit accounts receivable to reduce it.

The other options are liabilities or related to costs. Notes payable and accounts payable are liabilities and normally carry credit balances, since increases are recorded on the right. Expenses also typically have debit balances because they increase costs, but the clear illustration among these choices of a normal debit-balance asset is accounts receivable.