An example of a valuation account associated with a liability is Discount on Bonds Payable. The debit balance in this valuation account will be combined with the credit balance in Bonds Payable in order to report the carrying amount of the bonds. Premium on Bonds Payable is a valuation account with a credit balance.
To learn more, see the Related Topics listed below:
After working as an accountant, consultant, and university accounting instructor for more
than 25 years, Harold Averkamp formed AccountingCoach in 2003. His goal was to
share his knowledge and passion for teaching accounting with people throughout the
world at a very low cost. Read More...