Question

Identify the normal balance (debit or credit) for each of the following accounts.

a. Fees Earned (Revenues) d. Wages Expense g. Wages Payable

b. Office Supplies e. Accounts Receivable h. Building

c. Dividends f. Prepaid Rent i. Common Stock

Short answer

a – Credit e – Debit i – Credit

b – Debit f – Debit

c – Debit g – Credit

d – Debit h – Debit

Step-by-step solution

Accounts having debit balances

Assets generally come under real and personal accounts. As per real account what comes in business is debited and what goes out is credited. So as per this rule, the real account generally has debit balances. For personal account receiver is debited.

Apart from this, all the expense comes under the nominal account and is debited.

So from the given list, the following accounts would have debit balances –

b. Office supplies

c. Dividend

d. Wages Expense

e. Accounts receivable

f. Prepaid rent

h. Building

Accounts having credit balances

Liabilities are the personal and capital accounts that have a credit balance in general. All the expenses and gains are credited as per the personal account rule.

So from the given list, following accounts would have credit balances –

a. Fees earned

g. Wages payable

i. Common stock