BACHELOR OF BUSINESS ADMINISTRATION

Detailed explanation-1: -Assets and expenses have natural debit balances. This means that positive values for assets and expenses are debited and negative balances are credited. For example, upon the receipt of $1, 000 cash, a journal entry would include a debit of $1, 000 to the cash account in the balance sheet, because cash is increasing.

Detailed explanation-2: -Typically, when reviewing the financial statements of a business, Assets are Debits and Liabilities and Equity are Credits.

Detailed explanation-3: -Assets normally have debit balance and Liabilities and Equity normally have credit balance. Since Revenues increase Equity, they also normally have a credit balance and since Expenses decrease Equity, they normally have a debit balance.

Detailed explanation-4: -Correct Answer: Option (b) Assets normally show a debit balance. The accounting rule states that all the assets are debited.

Detailed explanation-5: -Assets, expenses, losses and the owner’s drawing account will normally have debit balances.