Which of the Following Applications of the Rules of Debit

question 64

Multiple Choice

Which of the following applications of the rules of debit and credit is true?

• A) decrease Prepaid Insurance with a credit and the normal balance is a credit
• B) increase Accounts Payable with a credit and the normal balance is a debit
• C) increase Supplies Expense with a debit and the normal balance is a debit
• D) decrease Cash with a debit and the normal balance is a credit

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Definitions:

Net Income

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

Salary Allowances

Predetermined amounts provided to employees, on top of their basic salary, for specific purposes such as travel, housing, or food.

Market Value

The ongoing rate for buying or selling a product or service in a trading environment.

Book Value

The net value of an asset or liability according to its balance sheet account balance, accounting for factors like depreciation.