Normal Balances of Accounts

All accounts will normally have a balance on their increase side.

For example:
CASH is increased by debits and has a debit normal balance. (because it is an asset)
ACCOUNTS PAYABLE is increased by credits and has a credit normal balance (liability)
FEES EARNED is increased by credits and has a credit normal balance (revenue)

So, If you know the Rules of Debits and Credits, you also know the normal balance rules.

Here is a summary:
All Asset accounts        Increased by debits    Normal balance is a debit
All Liability accounts     Increased by credits    Normal balance is a credit
Capital Stock                Increased by credits    Normal balance is a credit
Retained Earnings          Increased by credits    Normal balance is a credit
Dividends                    Increased by debits        Normal balance is a debit
All Revenue accounts    Increased by credits    Normal balance is a credit
All Dividend accounts    Increased by debits    Normal balance is a debit

Look at the following account.  What is the account balance?

The account has a $2,000 debit balance.
Why? - because the amount of the debits is greater than the amount of the credits.
Accounts Receivable will normally (In your class ALWAYS) have a debit balance because it is an asset.

Here is another account.  Please find the balance.  State if it is a debit or credit balance.  Tell me why.

ANSWER

Y'all.  This is pretty easy as long as you know your account types.  Here is a quiz

QUIZ