Question

Capital inflows are recorded as ______ entries, while capital outflows are recorded as ______ entries.

Options

• Debit (−); Debit (−)

• Credit (+); Debit (−)

• Debit (−); Credit (+)

• Credit (+); Credit (+)

Answer 1

By the recording rule, capital inflows bring foreign exchange into the country and are recorded as Credit (+), while capital outflows take foreign exchange out and are recorded as Debit (−).