Rules of debit and credit

1. Rules of Debit and Credit Meaning Samples Accounting Equation

2. debit Means “Left side of an account.” The word Debit is abbreviated as Dr.

3. Credit Means “Right side of an account.” Credit is abbreviated as Cr.

4. SAMPLES

5. Purchased computer unit for P30,000, on account. Asset (Office Equipment) 30, 000 Liability (Accounts Payable) 30,000 Increase in Asset is Debited; Increase in Liability is Credited.

6. (2) Purchased computer unit for cash, P30,000 Asset (Cash) 30 , 000 30, 000 Asset (Office Equipment) 30,000 30,000 Increase in Asset is Debited; Decrease in onother form of Asset is Credited.

7. (3)Rendered Service on Account. P20,000 Asset (Accounts Receivable) 20 , 000 Revenue (Service Revenue) 20, 000 Increase in Asset is Debited; Increase in Revenue is Credited.

8. (4) Paid the account to supplier in full, P 30,000 Asset (Cash) 30,000 Liability (Accounts Payable) 30,000 Decrease in Asset is Credited; Decrease in Liability is Debited.

9. (5) Paid Salaries of employees. P20,000 Asset (Cash) 20,000 Expense (Salaries Expense) 20,000 Decrease in Asset is Credited; Increase in Expense is Debited.

10. Accounting Equation Asset = Liabilities + Capital