Sales Revenue Has A Normal Credit Balance

A portion of sales revenue may be paid in cash and a portion may be paid on credit through means such as accounts receivables.

Sales revenue has a normal credit balance. The source document for cash received on account from the customer is a receipt. The normal balance of the sales returns and allowances account is a a credit b a debit c zero. Sales is a revenue account with a normal credit balance. Sales discounts are recorded as debits to the sales revenue account.

The revenue account sales has a normal credit balance. Gain on sale of asset d. From the table above it can be seen that assets expenses and dividends normally have a debit balance whereas liabilities capital and revenue normally have a credit balance. The balance in the common stock account is increased by a credit.

The liability account sales tax payable has a normal credit balance. Cost of goods sold is an asset v account with a normal debit balance. The exceptions to this rule are the accounts sales returns sales allowances and sales discounts these accounts have debit balances because they are reductions to sales. When cash is received on account the cash account balance increases and the accounts receivable account balance increases.

A normal balance is the expectation that a particular type of account will have either a debit or a credit balance based on its classification within the chart of accounts it is possible for an account expected to have a normal balance as a debit to actually have a credit balance and vice versa but these situations should be in the minority. The sales revenue account has a normal credit balance and is closed at the end of the accounting period. Accounts receivable accounts receivable ar represents the credit sales of a business which are not yet fully paid by its customers a current asset on the balance sheet. By identifying the type of account asset liability etc and establishing which side of the accounting equation it is on left or right it is possible to determine.

A revenue account has a normal debit balance. Sales discounts is a contra revenue account with a normal debit balance. At the end of the accounting year the credit balances in the revenue accounts will be closed and transferred to the owner s capital account thereby increasing owner s equity. Inventory is an asset account with a normal debit balance.

Each of the following accounts has a normal credit balance except. The sales revenue account is used to record the sales of goods held for resale to customers. Accounts with balances that are the opposite of the normal balance are called contra accounts. Hence contra revenue accounts will have debit balances.

Sales returns and allowances is a contra revenue account with a normal credit balance.