Show credit and debit rules for expense, Accounting Basics

Assignment Help:

Q. Show Credit and debit rules for expense?

The credit and debit rules for expense and Dividends accounts and for revenue accounts follow logically if you remember that expenses and dividends are decreases in stockholders' equity and revenues are increases in stockholders' equity. Ever since stockholders' equity accounts decrease on the debit side expense and Dividend accounts increase on the debit side.

Since stockholders' equity accounts raise on the credit side revenue accounts increase on the credit side. The last three credit and debit rules are:

- Diminish in revenue accounts are debits increases are credits.

- Raise in expense accounts are debits decreases are credits.

- Raise in Dividends accounts are debits decreases are credits.

Note first the management of expense and Dividends accounts as if they were sub classifications of the debit side of the Retained Earnings account.


Related Discussions:- Show credit and debit rules for expense

Consistency principle, A company has been depreciating its IT equipment ove...

A company has been depreciating its IT equipment over 5 (five )years, but now finds that it is becoming obsolete in 3 years.   What does the consistency principle allow the comp

Show accounting deception situations, Q. Show accounting deception situatio...

Q. Show accounting deception situations? In 2002 The Sarbanes-Oxley Act was approved. The Act was approved as one result of the large losses to the employees and investors from

Amount of dividends, Houston Corporation has the following stock outstandin...

Houston Corporation has the following stock outstanding:     In 2012, Houston paid $330,000 in dividends. No dividends were paid in 2011 or 2010. Required : a)

Excess payment to supplier, What process for excess payment to supplier I w...

What process for excess payment to supplier I would like know without adjusting invoice that means how supplier will send back surplus amount how do in oracle apps?          Ans

Explain benchmarking, Benchmarking A process by which a company reasse...

Benchmarking A process by which a company reassesses its established business practices by comparing them with the best practices of other organizations.  This process is desi

State the steps of merchandise inventory, State the steps of Merchandise in...

State the steps of Merchandise inventory 1) TRANSFER THE BEGINNING INVENTORY FIGURE Debit INCOME SUMMARY for beginning inventory amount. Credit MERCHANDISE INVENTORY fo

Frank Woods Business Accounting, J Green''s financial position at 1 May 200...

J Green''s financial position at 1 May 2008 was as follows bank 2,910 cash 160 equipment 5,900 premises 25,000 creditors R smith 890 t thomas 610 debtors j car

How to create account for barter transactions?, How to create account for b...

How to create account for barter transactions? As My Company is providing a service to another company and that company is reimbursing us with his service.

Explain about long-term investments, Q. Explain about Long-term investments...

Q. Explain about Long-term investments? A long-term investment habitually consists of securities of another company held with the intention of (a) obtaining control of another

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd