Expense accounts are increased with credit entries.

Question

BlackTom AI · Accepted Answer

The statement to evaluate is: 'Expense accounts are increased with credit entries.'
Option 1: True. In accounting terms, expense accounts are typically increased by debits, not credits. Debiting an expense account increases its balance, reflecting more expense incurred, while crediting would decrease an expense account, which is inconsistent with standard double-entry principles.
Option 2: False. This aligns with the conventional understanding that expenses are debited to increase their balances. The credit side would reduce an expense, which is not how expenses are normally recorded when they rise.
To further clarify, in double-entry bookkeeping, assets and expenses generally have normal debit balances, so increases in these accounts are recorded as debits. Conversely, liabilities, equity, and revenues normally have credit balances, and increases for those are recorded as credits. Therefore, stating that expense accounts are increased with credit entries contradicts the standard convention, making the statement incorrect.

Expense accounts are increased with credit entries.

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