Question

For each​ account, identify whether the changes would be recorded as a debit​ (DR) or credit​ (CR). a. Increase to Accounts Receivable b. Decrease to Unearned Revenue c. Decrease to Cash d. Increase to Interest Expense e. Increase to Salaries Payable f. Decrease to Prepaid Rent g. Increase to Proudfoot, Capital h. Increase to Notes Receivable i. Decrease to Accounts Payable j. Increase to Interest Revenue

Answer 1

Answer:

(a) DR ,(b) DR ,(c) CR ,(d) DR, (e) CR, (f) CR, (g) CR, (h) DR ,(i) DR, (j) CR

Explanation:

(a) DR-This is an increase in current asset.

(b) DR-This is a decrease in deferred income i.e currently a liability.

(c) CR -This is an outflow of cash

(d) DR-

(e) CR-This represents increase in current liabilities.

(f) CR-Prepaid rent is a current asset item. This represents decrease in current assets.

(g) CR-

(h) DR-Notes Receivable is a current asset item. Increase represents increase in current asset.

(i) DR-Account payable is a current liability item.This represents decrease in current liability.

(j) CR-Interest revenue is an income item. This represents increase increase in income

Answer 2

Answer: Explanation:

a. Increase to Accounts Receivable: Debit

Assets account increase from debit

b. Decrease to Unearned Revenue: Debit

Liabilities account decrase from debit

c. Decrease to Cash: Credit

Assets account decrease from Credit

d. Increase to Interest Expense: Debit

Expenses are debited

e. Increase to Salaries Payable: Credit

Liabilities accounts increase from credit

f. Decrease to Prepaid Rent: Credit

Assets account decrease from Credit

g. Increase to Proudfoot, Capital: Credit

Equity account: Increase from Credit

h. Increase to Notes Receivable  Debit

Assets account increase from debit

i. Decrease to Accounts Payable: Debit

Liabilities account decrase from debit

j. Increase to Interest Revenue: Debit

Expenses are debited