Which entry would increase a revenue account?

Which entry would increase a revenue account?

• A. Credit Service Revenue $X
• B. Debit Service Revenue $X
• C. Debit Cash $X
• D. Credit Cash $X

Answer: (A)

Revenue accounts have a normal credit balance, so they increase with credits and decrease with debits. When you record revenue, you credit the revenue account. Therefore, credit Service Revenue $X increases the revenue balance. Debiting the revenue account would reduce it, which isn’t how revenue is normally increased. Debiting cash increases the asset, and crediting cash decreases it, but neither action directly increases revenue. If cash is received for services, you would debit Cash and credit Service Revenue, and the credit still raises the revenue amount.

Revenue accounts have a normal credit balance, so they increase with credits and decrease with debits. When you record revenue, you credit the revenue account. Therefore, credit Service Revenue $X increases the revenue balance. Debiting the revenue account would reduce it, which isn’t how revenue is normally increased. Debiting cash increases the asset, and crediting cash decreases it, but neither action directly increases revenue. If cash is received for services, you would debit Cash and credit Service Revenue, and the credit still raises the revenue amount.