how do debits and credits work?
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3. In double entry accounting, all errors are avoided by being sure that debits and credits equal when transactions are recorded.
A double-entry accounting system is an accounting system:
a. That records each transaction twice.
b. That records the effects of transactions and other events in at least two accounts with equal debits and credits.
c. In which each transaction affects and is recorded in two or more accounts but that could include two debits and no credits.
d. That may only be used if T accounts are used.
e. That ensures that errors never occur.
Which of the following is not a correct rule of debits and credits?
a. The normal balance for revenues and expenses is a credit.
b. Liabilities, revenues, and stockholders' equity are increased by credits.
c. Assets, expenses, and dividends are increased by debits.
d. Assets are decreased by credits and have a normal debit balance.