Classification of Accounting
In this picture, it shows how increases in these areas affect the debit and credit and effects a certain side of the equation.
In assets, increases are placed on the debit side while decreases are place on the credit side.
For liabilities and equities, decreases are on the (left) debit side and increases are on the (right) credit side.
Accounting Terms
The basics of account revolves around a set of terms; assets, liabilities, owner’s equity, revenue, and expenses.
An asset is any property or item of value that a businness owns.
Revenue is the amount of income a businness recieves, and expenses are the costs to run the business.
Owner's equity is the owner's claim to the assets of the business.
Lastly, liabilties are the creditor's claim to the assets of the business.
An asset is any property or item of value that a businness owns.
Revenue is the amount of income a businness recieves, and expenses are the costs to run the business.
Owner's equity is the owner's claim to the assets of the business.
Lastly, liabilties are the creditor's claim to the assets of the business.
Dead Coil
Debit
Expenses
Assets
Drawing
Credit
Owner's equity
Income
Liabilty
Expenses
Assets
Drawing
Credit
Owner's equity
Income
Liabilty