The Normal Balance of a Liability Account Is a Debit

question 61

True/False

The normal balance of a liability account is a debit.

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Definitions:

Diluted Earnings

An earnings calculation that accounts for all potential shares that could be issued, showing the lowest possible earnings per share.

Preferred Stock

A type of stock that provides a specific dividend that is paid before any dividends are paid to common stockholders, and that typically does not have voting rights.

Common Stock

A type of equity ownership in a corporation, representing a claim on a portion of the profits and assets, and giving voting rights in corporate decisions.

Net Income

The total profit of a company after all revenues, costs, and expenses have been deducted.