Which of the following statements regarding T-accounts is true?

• A. The right side of a T-account represents debits and the left side represents credits.
• B. T-accounts are only used for recording revenues and expenses.
• C. The left side of a T-account represents debits and the right side represents credits.
• D. T-accounts are used exclusively for preparing financial statements.

Answer: (C)

Verified step by step guidance

1. Understand the structure of a T-account: A T-account is a visual representation of an account in the ledger, shaped like the letter 'T'. It has two sides: the left side is for debits, and the right side is for credits.
2. Clarify the concept of debits and credits: Debits and credits are fundamental to double-entry accounting. Debits increase asset and expense accounts, while credits increase liability, equity, and revenue accounts.
3. Evaluate the statement 'The right side of a T-account represents debits and the left side represents credits': This statement is incorrect because the left side represents debits, and the right side represents credits.
4. Assess the statement 'T-accounts are only used for recording revenues and expenses': This is incorrect because T-accounts are used for all types of accounts, including assets, liabilities, equity, revenues, and expenses.
5. Analyze the statement 'T-accounts are used exclusively for preparing financial statements': This is incorrect because T-accounts are primarily used for recording transactions and analyzing account balances, not exclusively for preparing financial statements.