Rules of debit and credit

Basic Rules of Debit. and Credit.

1. Rules of Debit and Credit M Kamran Bashir

2. Basic Five Classification of Accounts. Debit Balance 1. Accounts OF Assets. 2. Accounts OF Expenses. Credit Balance. 1. Accounts OF Liabilities 2. Accounts of Owner Equity. 3. Accounts Revenues.

3. Rules of Debit and Credit of Assets. Increase in a n asset is record on the left side or debit side of Accounts. Decrease in a assets is recorded on the right side or credit side of the Accounts.

4. Purchase furniture for Rs .10000 on Cash Basis . Furniture A/c 10000 Cash A/c 10000

5. Rules of Debit and Credit of Expenses. Increase in an Expenses is record on the left-hand side or Debit side of Accounts. Decrease in a Expenses is recorded on the right side or credit side of the Accounts.

6. Wages Rs. 6000 paid to workers.. Wages Accounts 6000 Cash A/c 6000

7. Rules of Debit and Credit of Liabilities. Decrease in Liabilities is record on the debit side of Accounts. Increase in a Liabilities is recorded on the credit side of the Accounts.

8. Rules of Dr. And Cr. Of Liabilities. Furniture Purchase Rs. 5000 From Asif Furniture A/c 5000 Asif A/c 5000 (Increase) When Amount of Liability Paid to Asif . Asif A/c 5000 (decrease) Cash Account 5000

9. When owner Equity Increase Its is Credited. Mr. Ahmad Started Business For Rs. 500,000 Cash A/c 500,000 Ahmad Capital A/c 500,000

10. Rules Of Dr. and Cr. Of Revenue. When revenue Increase Its is Credit. When Revenue are decrease Its is Debited Goods sold for Rs. 50,000 . Cash A/c 50,000 Sales Accounts 50,000