Asset account could be credit like account Accumulated Depreciation because it is credited for the amounts that are debited to Depreciation Expense.
also bad debt will have credit balance ...
there are few case can be credit ..other wise it is mistake
Because of contra asset accounts which are asset accounts with credit balances. For example, accumulated depreciation and allowance for bad debts.
Also a wrong journal entry can also create a temporary credit balance (until it is fixed in the books)
assets accounts usually have a debit balance.. however the accumulated depreciation account has a nature of credit.. so that in order to net it off against the debit balance of asset account in order to show a decrease in value.. in other instances if we revalue our asset this increase is usually a debit in asset accounts but in order to balance and fulfill the requirements of accounting standards we create a revaluation reserve account in equity portion.. this revaluation reserve balance is of credit nature also..
Assets in business and accounting, economic resources are owned by the business or company. Namely, any ownership of tangible or intangible adequate to repay the debt can be considered an asset. And assets in simple words, are the things of value that can be easily converted into cash (although cash itself is also considered an asset) [1]. The recorded balance sheet (balance sheet) the company's cash value [2] of the assets owned by, they offer a physical representation of the company's assets and debts in one day. And assets are money and other valuables owned by an individual or a company's business. [3]. Assets are classified into two main categories. Tangible assets and intangible assets. Tangible assets contain different subclasses, including current assets and fixed assets [4]. The assets are traded for less than a financial period and can be converted to money easily, and include debtors (customers) and notes receivable and inventory (complete and incomplete) and the goods are (Inventory) and الاستثمارت short-term ..., etc., while the fixed assets: used for several periods of accounting, including land, cars and buildings include machinery and equipment [5]. Intangible assets are the resources and the rights of non-material value of the company because it gives the company some sort of advantage in the commercial market. As examples of intangible assets brand name, copyright, trademarks, patents, and computer programs. [5] And financial assets such as accounts receivable, bonds, and equities.
Also known as the Commission on the terms of the complex accountants American (AICPA) assets as "Xi represents a debit balance met for deportation for the next period to lock accounts depending on the accounting principles on the basis that represents either the right of ownership or value that can be obtained and the expense has and created a property right or is likely to be found in the future . " And defined concepts and standards committee of the American Accounting Association (FASB) as "economic resources are allocated for the purposes of the project during a specific accounting unit are gatherings of services expected to be obtained in the future."
by
Ghulam Mustafa , Finance Manager , Al Hamli Group of Companies
A few asset accounts intentionally have credit balances. For instance, the account Accumulated Depreciation (which is a plant asset account) will have a credit balance since it is credited for the amounts that are debited to Depreciation Expense. The account Allowance for Bad Debts will have a credit balance for the amounts in Accounts Receivable that are not likely to be collected. The accounts Accumulated Depreciation and Allowance for Bad Debts are referred to as contra asset accounts because their credit balances are contrary to the expected debit balances found in most asset accounts.
There are also unexpected situations that result in asset accounts having credit balances. Here are five examples:1. An error caused by posting an amount to an incorrect account.2. Continuing to depreciate or amortize an asset after its balance has reached zero.3. Receiving and posting an amount that was greater than the recorded receivable.4. Expenses occurred faster than the agreed upon prepayments.5. The amount of checks written exceeded the positive amount in the Cash account.
Before issuing the balance sheet, any errors (such as items1 and2) need to be corrected. The accounts with credit balances in items3,4, and5 need to be reclassified to the liability section of the balance sheet.
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Joe Akiki , Internal Auditor , Bassil Audit Firm
A few asset accounts intentionally have credit balances. For instance, the account Accumulated Depreciation (which is a plant asset account) will have a credit balance since it is credited for the amounts that are debited to Depreciation Expense. The account Allowance for Bad Debts will have a credit balance for the amounts in Accounts Receivable that are not likely to be collected. The accounts Accumulated Depreciation and Allowance for Bad Debts are referred to as contra asset accounts because their credit balances are contrary to the expected debit balances found in most asset accounts.
As per my knowledge, there I haven't yet seen any asset which having credit balance, as per the basic study, I studied that, asset having debit balance, anyway if you saw it in some entry, it may be a mistake or maybe for the reduction in the value of that particular asset.
Dr balances= assets , expenses
Cr balances=liabilities, incomes
For the reduction of a value of a debit balanced item, we can credit it and for the increase in the value of a debit balanced item we can debit it,
For the reduction of a value of a credit balanced item, we can debit it and vice versa.
Thank You