Account Balances

For many purposes, it is necessary to determine the balance in an account. This is accomplished by adding the debits, credits, and determining the difference between the two sums. An account is said to have a debit balance if the sum of the debit entries to that account exceeds the sum of the credit entries. Conversely, an account has a credit balance if the sum of the credit entries exceeds the sum of the debit entries. Asset accounts normally have debit balances inasmuch as these accounts are increased by debiting.