{"id":231713,"date":"2025-06-11T10:36:24","date_gmt":"2025-06-11T10:36:24","guid":{"rendered":"https:\/\/learnexams.com\/blog\/?p=231713"},"modified":"2025-06-11T10:36:26","modified_gmt":"2025-06-11T10:36:26","slug":"which-of-the-following-accounts-has-a-normal-credit-balance-3","status":"publish","type":"post","link":"https:\/\/www.learnexams.com\/blog\/2025\/06\/11\/which-of-the-following-accounts-has-a-normal-credit-balance-3\/","title":{"rendered":"Which of the following accounts has a normal credit balance"},"content":{"rendered":"\n

Which of the following accounts has a normal credit balance? A selling expense B Sales Discounts C sales returns and allowances D sales revenue<\/p>\n\n\n\n

The Correct Answer and Explanation is:<\/mark><\/strong><\/p>\n\n\n\n

Correct Answer: D. Sales Revenue<\/strong><\/p>\n\n\n\n

\n\n\n\n

Explanation:<\/h3>\n\n\n\n

In accounting, normal balances<\/strong> refer to the side of an account (debit or credit) that increases the value<\/strong> of that account. To understand which accounts have normal credit balances, it’s helpful to know the basic types of accounts and their typical balances:<\/p>\n\n\n\n

    \n
  • Assets<\/strong> \u2192 Normal debit<\/strong> balance<\/li>\n\n\n\n
  • Liabilities<\/strong> \u2192 Normal credit<\/strong> balance<\/li>\n\n\n\n
  • Equity (Capital)<\/strong> \u2192 Normal credit<\/strong> balance<\/li>\n\n\n\n
  • Revenues<\/strong> \u2192 Normal credit<\/strong> balance<\/li>\n\n\n\n
  • Expenses<\/strong> \u2192 Normal debit<\/strong> balance<\/li>\n\n\n\n
  • Contra accounts<\/strong> \u2192 Have a balance opposite to the normal balance of the account they relate to<\/li>\n<\/ul>\n\n\n\n

    Now, let\u2019s examine each option:<\/p>\n\n\n\n

    A. Selling Expense<\/strong> \u2013 This is an expense account<\/strong>. It includes costs incurred to sell products (e.g., advertising, sales commissions). Like all expenses, it has a normal debit balance<\/strong>.<\/p>\n\n\n\n

    B. Sales Discounts<\/strong> \u2013 This is a contra-revenue account<\/strong>. It reduces total sales revenue when customers are given a discount for early payment. Since it is contra to revenue, it has a normal debit balance<\/strong>, not credit.<\/p>\n\n\n\n

    C. Sales Returns and Allowances<\/strong> \u2013 This is also a contra-revenue account<\/strong>. It is used to record returns or price adjustments for defective or unsatisfactory goods. Like sales discounts, it carries a normal debit balance<\/strong>.<\/p>\n\n\n\n

    D. Sales Revenue<\/strong> \u2013 This is a revenue account<\/strong>, which records the total income from selling goods or services before any deductions. Revenue accounts have a normal credit balance<\/strong>, meaning they increase with a credit entry.<\/p>\n\n\n\n

    Therefore, the correct answer is D. Sales Revenue<\/strong>, as it is the only account listed that naturally carries a credit balance. Understanding account types and their normal balances is foundational for preparing accurate financial statements and performing journal entries correctly in accounting.<\/p>\n\n\n\n

    \"\"<\/figure>\n","protected":false},"excerpt":{"rendered":"

    Which of the following accounts has a normal credit balance? A selling expense B Sales Discounts C sales returns and allowances D sales revenue The Correct Answer and Explanation is: Correct Answer: D. Sales Revenue Explanation: In accounting, normal balances refer to the side of an account (debit or credit) that increases the value of […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[25],"tags":[],"class_list":["post-231713","post","type-post","status-publish","format-standard","hentry","category-exams-certification"],"_links":{"self":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/231713","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/comments?post=231713"}],"version-history":[{"count":0,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/231713\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/media?parent=231713"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/categories?post=231713"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/tags?post=231713"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}