What is the normal balance for the Sales (Sales Revenue) account?

• A. Credit.
• B. Debit.
• C. Zero.
• D. Debit or Credit depending on period.

Answer: (A)

Sales Revenue is a revenue account. Revenue increases the owners’ equity of the business, and in double-entry bookkeeping, increases to revenue are recorded on the credit side. That means the normal balance of the Sales Revenue account is a credit.

When a sale occurs, you typically credit Sales Revenue (for example, crediting Sales Revenue when you record cash or accounts receivable). The account balance sits on the credit side because that’s how revenue grows the equity in the business. At period end, revenue is closed to the profit and loss (or to retained earnings in some systems), but during the period its normal balance remains credit.