RULES OF ACCOUNTING

"RULES OF ACCOUNTING GENERAL ENTRIES"
                 " (debit and credit)"



1: when assets are increased then assets is debit and when assets are decreased then assets are credit .

2: when liabilities are increased then liabilities are credit and when liabilities are decreased then liabilities are debit .

3: when revenue are increased then revenue also are credit and when revenue are decreased then revenue are debit (revenue always increased that's why always credit).


4: when expenses are incur in the business then expenses are debit (expenses are always debit).

5: when owner are invested in the business then capital a/c is always credit.


                "every entry has a two aspect one is debit and the other one is credit"

First of all we must identify the accounting heads means the entry is fall in the assets,revenue,liability or expenses .

Then one head is debit and other one head is credit .

(ie the  expenses are paid by cash rs 100 )

In which entry two a/c heads are used, the expense are incur with Rs 100 and expenses are increased that's why expenses a/c are debit and on the other hand cash is a assets and assets are decreased by Rs 100  that's why the cash a/c are credit.

Expenses a/c    100
           to   cash a/c 100
expenses are paid in cash.

At the end of the every entry the short summary of the transaction is wrote is call "narration".