Question

Identify whether a debit or credit yields the indicated change for each of the following accounts %

a. To increase Prepaid Rent
b. To decrease Prepaid Parking
c. To increase Repairs Expense
d. To increase Commission Revenue
e. To decrease Rent Payable
f. To decrease Supplies
g. To increase Unearned Revenue
h. To decrease Equipment
i. To increase Retained Eamings
j. To increase Store Supplies

Answer 1

a. To increase Prepaid Rent ⇒ DEBIT, since this is an asset account, in order to increase it you must debit it.

b. To decrease Prepaid Parking ⇒ CREDIT, since this is an asset account, in order to decrease it you must credit it.

c. To increase Repairs Expense ⇒ DEBIT, since this is an expense account, in order to increase it you must debit it.

d. To increase Commission Revenue ⇒ CREDIT, since this is a revenue account, in order to increase it you must credit it.

e. To decrease Rent Payable ⇒ DEBIT, since this is a liability account, in order to decrease it you must debit it.

f. To decrease Supplies ⇒ CREDIT, since this is an asset account, in order to decrease it you must credit it.

g. To increase Unearned Revenue ⇒ CREDIT, since this is a liability account, in order to increase it you must credit it.

h. To decrease Equipment ⇒ DEBIT, since this is an asset account, in order to increase it you must debit it.

i. To increase Retained Earnings ⇒ CREDIT, since this is an equity account, in order to increase it you must credit it.

j. To increase Store Supplies ⇒ DEBIT, since this is an asset account, in order to increase it you must debit it.