Assuming a Normal Balance, Which of the Following Is Correct

question 80

Multiple Choice

Assuming a normal balance, which of the following is correct concerning the balance sheet columns of the work sheet?

• A) Assets are shown as debits.
• B) Liabilities are shown as debits.
• C) The drawing account is shown as a credit.
• D) Revenues are shown as credits.

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Definitions:

Collusion

An agreement, usually illegal, between rivals in which they decide not to compete with each other, often resulting in higher prices or restricted supply of products or services.

Rule-of-thumb

A practical principle that is not strictly accurate in all cases but is sufficient for most circumstances.

Price Elasticity

A measure of how much the quantity demanded of a good responds to a change in its price, indicating the sensitivity of consumers to price changes.

Elastic

Describes a situation where the quantity demanded or supplied of a good responds significantly to changes in its price.