The cash account will always be debited.

• A. Yes
• B. No
• C. Sometimes
• D. Only for receipts

Answer: (B)

In double-entry accounting, cash is an asset with a normal debit balance. That means cash increases are recorded by debiting the cash account, while cash decreases are recorded by crediting it. So cash is debited when cash comes in (receipts) but credited when cash goes out (disbursements).

For example, receiving cash from a customer increases the cash balance and is entered as a debit to cash. Paying a supplier or repaying a loan decreases the cash balance and is entered as a credit to cash. Because cash can both increase and decrease depending on the transaction, it will not always be debited. The statement is false.