In The First Month Of Operations, The Total Of The Debit Entries To The Cash Account Amounted To $3,000 And The Total Of The Credit Entries To The Cash Account Amounted To $1,800. The Cash Account Has A

The correct option of this multiple choice question (mcq) is C, as the debit side of cash account, amounting to $3,000, is greater than the credit side of cash account, amounting to $1,800. The debit side is greater than credit side by $1,200 ($3,000 - $1,800). Actually, if the total of debit side or left side of an account is greater than the credit side or right side, then the resulted balance is called debit balance. Conversely, if the total of credit side is greater than the debit side of an account, then, there is a credit balance. Those accounts which have favorable debit balances are assets and expenses. Liabilities, equity and revenues have favorable credit balances. It is possible that assets have negative credit balances while liabilities also show negative debit balances under certain circumstances. For example, in case of Bank Overdraft i.e., if the company withdrew money than the amount deposited into the bank account, then, cash account shows credit balance. The exce...