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Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FA – FIA FFA › sales tax
E sales tax showed an opening credit balance of $4,540 at the beginning of the month and a closing debit balance of $2,270 at the end of the month.
-What does” an opening credit balance of $4,540″ mean? Is it a balance b/d or c/d and on which side it appears( DR or CR)
-What does”a closing debit balance of $2,270″ mean?Is it a balance b/d or c/d and on which side it appears( DR or CR)
I do have watched your free lecture notes but still facing some difficulties in understanding this.
If there is an opening credit balance, then it is on the credit side of the account.
If there is a closing debit balance, then it ends up on the debit side at the beginning of the next period, which means that it is carried forward from the credit side in this period.