Indicate Whether a Debit or a Credit Entry Would Be

question 131

Essay

Indicate whether a debit or a credit entry would be made to record the following changes in each account.(a) To decrease Cash.(b) To increase Owner, Capital.(c) To decrease Accounts Payable.(d) To increase Salaries Expense.(e) To decrease Supplies.(f) To increase Revenue.(g) To decrease Accounts Receivable.(h) To increase Owner, Withdrawals.

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Definitions:

LIFO Inventory Method

Last In, First Out, an accounting method where the most recently acquired items are the first to be sold or used.

Gross Profit

The difference between revenue and the cost of goods sold, indicating how efficiently a company uses labor and supplies in production.

FIFO Method

An inventory valuation method that assumes that the first items produced or purchased are the first used or sold.

Unit Costs Decreasing

A situation indicating that the expense incurred to produce a single unit of output is declining, often due to efficiencies or increased production scale.