What type of account is described by 'Income' in the Chart of Accounts?

• A. Asset
• B. Income
• C. Liability
• D. Expense

Answer: (B)

Income is a revenue account in the Chart of Accounts. It tracks money earned from selling goods or providing services and sits on the income statement, increasing the owners’ equity when revenue is earned. In double-entry bookkeeping, revenue accounts typically carry a credit balance and are increased by credits, not debits, and they are separate from assets (what you own), liabilities (what you owe), and expenses (costs incurred). QuickBooks uses the Income type to group all revenue in one place so you can report total revenue clearly. When you record a sale, you credit the Income account and debit cash or accounts receivable, showing that revenue has increased equity.