Kobayashi Company has the following accounts:

Instructions
(a) Complete the table. Identify
(1) The type of account as asset, liability, or owner's equity (for owner's equity accounts, also identify if it is a capital, drawings, revenue, or expense account);
(2) What financial statement it is presented on; and
(3) The normal balance of the account. The first one has been done for you as an example.
(b) Explain why the normal balance for each of the different types of accounts is either a debit or credit. Refer to the accounting equation in your explanation.

Transcribed Image Text:

Type of Account Asset Account Financial Statement Normal Balance Cash M. Kobayashi, Capital Accounts Payable Building Fees Earned Insurance Expense Interest Revenue M. Kobayashi, Drawings Notes Receivable Prepaid Insurance Rent Expense Supplies Balance Sheet Debit