Accounting Debit and Credit

Chart of Accounts

A list of all the accounts a business uses.

T Account

A tool used by accountants to analyze business transactions.

Ledger

Accounts are group together.

Accounts Payable

Debit- Decrease, Credit- Increase Balance

Capital

Debit- Decrease, Credit- Increase Balance

Asset

Debit- Increase Balance, Credit- Decrease

T/F "Debit" means to increase an account balance.

False

T/F Asset accounts are increased on credit side.

False

T/F Double entry accounting is the record keeping system in which each business transaction affects at least one account.

False

T/F Every business transaction affects at least two accounts that are on different sides of the basic accounting equation.

False

T/F Liability and capital accounts are increased on the debit side.

False

T/F The T account is an inefficient method for analyzing many business transactions.

False

T/F The normal balance side of an owner's capital account is the debit side.

False

Normal Balance

Of an account is the same side used to increased the account.

Double Entry Accounting

The financial record keeping system in which each business transaction affects at least two accounts.

Debit

The left side of a T account.

Credit

The right side of a T account.

T/F A credit is an amount entered on the right side of the T account.

True

T/F Debits and credits are used to record increases and decreases in each account affected by a business transaction.

True

T/F For every debit entry made in one account, a credit entry must be made in another account.

True

T/F If the accounting equation is not in balance after a transaction has been recorded, one reason may be that the debit or credit part of the transaction was not recorded.

True

T/F The normal balance side of an account is the same side that is used to record increases to the account.

True

T/F When analyzing business transactions, you should ask yourself which accounts are affected.

True