Which of the following statements about general ledger accounts is true?

• A. A debit entry always increases a liability account.
• B. A debit entry always increases an asset account.
• C. A credit entry always increases an expense account.
• D. A credit entry always increases an asset account.

Answer: (B)

Verified step by step guidance

1. Step 1: Begin by understanding the basic rules of debits and credits in accounting. In the double-entry accounting system, debits and credits are used to record transactions. Debits increase asset and expense accounts, while credits increase liability, equity, and revenue accounts.
2. Step 2: Analyze the first statement: 'A debit entry always increases a liability account.' This is incorrect because a debit entry decreases liability accounts, not increases them.
3. Step 3: Evaluate the second statement: 'A debit entry always increases an asset account.' This is correct because debits are used to increase asset accounts, such as cash, accounts receivable, and inventory.
4. Step 4: Examine the third statement: 'A credit entry always increases an expense account.' This is incorrect because credits decrease expense accounts, not increase them.
5. Step 5: Assess the fourth statement: 'A credit entry always increases an asset account.' This is incorrect because credits decrease asset accounts, not increase them.