Which option correctly describes the budgetary entry to record the budget?

• A. Debits to Revenues
• B. Credits to Appropriations
• C. Debits to Fund Balance
• D. Credits to Expenditures

Answer: (A)

In government accounting, the budget is recorded in budgetary control accounts to establish the legally approved limits. When the budget is adopted, the entry increases the budgeted resources by debiting the Revenues budgetary account (Estimated Revenues) and increases the budgetary authority by crediting the Appropriations budgetary account. The description “Debits to Revenues” best captures the initial side of this budgetary entry, since it reflects recognizing the planned resources that the budget authorizes. The other options don’t fit because they describe actions on fund balance, expenditures, or the opposite side of the appropriation, which don’t represent how the budget is first established.