Multiple choice

Total of debit side of cash book is ________ the credit side.

  1. equal to

  2. more than

  3. less than

  4. any one is possible
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

In a standard cash account, the debit side represents receipts and the credit side represents payments. Since a business cannot spend more physical cash than it has received, the debit total will always be greater than or equal to the credit total. This results in a debit balance, representing cash on hand.

Keep practicing — related questions