The balance of an account is determined by:

• A. Multiplying the total debits by the total credits in the account
• B. Adding the total debits and total credits in the account
• C. Dividing the total credits by the total debits in the account
• D. Subtracting the total credits from the total debits in the account

Answer: (D)

Verified step by step guidance

1. Understand the concept of an account balance: In financial accounting, the balance of an account is determined by the difference between the total debits and total credits recorded in that account.
2. Recall the basic rule: Debits increase asset and expense accounts, while credits increase liability, equity, and revenue accounts. The balance is calculated by subtracting the total credits from the total debits.
3. Set up the formula for calculating the account balance: \( \text{Account Balance} = \text{Total Debits} - \text{Total Credits} \).
4. Identify the total debits and total credits in the account: Review the ledger or transaction records to determine the sums of debits and credits.
5. Apply the formula: Subtract the total credits from the total debits to determine the account balance.