Interested to Buy Any Domain ? << Click Here >> for more details...
Answer Posted / naveen
credit and debit have only one meaning in Accounting.
Debit means the left side of an account, Credit means the
right side of an account.
The way accounts increase or decrease depend on the
account's normal balance. Cash has a normal debit balance,
meaning it increases on the left side of an account. So if
you get 500 hundred dollars cash you debit the account 500
dollars. Likewise if you lose 500 dollars cash you would
credit it 500 dollars (decrease).
Accounts with a credit balance like liabilities such as
Accounts Payable increase when you credit them, and decrease
when you debit them. When you take a loan out for 100,000
dollars, your Accounts Payable is credited 100,000 because
your increasing the right side of the account. Likewise when
you start paying it off, You debit what you are paying
because you are decreasing the amount you know.
Hopefully from these examples you understand that debit and
credit are not reversable, they always mean left and right.
Whether or not an account increases or decreases depends on
an accounts normal balance (credit balance or debit
balance). I think therein lies the confusion.
| Is This Answer Correct ? | 10 Yes | 3 No |
Post New Answer View All Answers
Explain what a deferred asset is and give an example?
What are the advantages of computer accounting over paper accounting?
Tell me how can you define departmental accounting?
how to calculate vat,pf,esi,service tax in corporate firm
What is the diffrent job&project accounting?
Can a firm claim preliminary expenses incurred(manufacturing) or only its is applicable to Companies? can a firm claim ,1/5 of such expenses incurred as deduction as in case of Companies? or any other procedure.
WHAT IS ACCOUNTING HEAD FOR TRADE FINANCE? I HAVE PAID 49268 FOR TRADE FINANCE.WHERE SHOULD I TAKE IN TALLY
What is accounting normalization?
is WCT aplicable on educational institutions also??????
what is difference among credit, loan, advance
how to enter the tender refund amount in tally ?
Please note that all the question related to VAT is belongs to pune, maharashtra. waiting for quality reply.
1. The following data is available. Determine the Break Even point in Sales: Sales : $1,800,000/- Fixed Expenses : $ 375,000/- Variable Expenses : $ 1,200,000/-
What is journalizing? What are the columns of a journal?
salary payable deduct tds entry
