An Account with a Normal Debit Balance Is Most Often

question 60

True/False

An account with a normal debit balance is most often an asset or revenue account.

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Definitions:

Goodwill

An intangible asset that arises when a business is acquired for more than its fair market value, reflecting factors like reputation, brand, and customer loyalty.

Net Working Capital

The difference between a company's current assets and its current liabilities, indicating the liquidity and operational efficiency of the business.

Current Assets

Short-term assets that are expected to be converted into cash, sold, or consumed within one year or within the business's operating cycle, whichever is longer.

Current Liabilities

Obligations a company needs to pay off within one year or within its operating cycle, whichever is longer.