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

Emerging role of accounting, The past of accounting specifies the evolution...

The past of accounting specifies the evolutionary pattern that reflects changing socioecoiom conditions and the enlarged reasons is that accounting is applied. In  the  current  co

What is operating revenues, Q. What is Operating revenues? Operating re...

Q. What is Operating revenues? Operating revenues are the revenues generated by the main activities of the business- generally the sale of products or services or both.

Example of net realizable value, Example of net realizable value? To ex...

Example of net realizable value? To exemplify a necessary write-down in the cost of inventory presume that an automobile dealer has a demonstrator on hand. The dealer obtained

Advantages and disadvantages of fifo, Q. Advantages and Disadvantages of FI...

Q. Advantages and Disadvantages of FIFO? FIFO: Advantages (a) FIFO is easy to apply (b) the assumed flow of costs habitually corresponds with the normal physical flow of goods

Accounting entity assumption and matching principle, 1. For each of the fol...

1. For each of the following accounting assumptions/principles, explain a business transaction:   (a) Accounting Entity Assumption (b) Going Concern Assumption (c) Matching Prin

Draw a stem-and-leaf plot for the data set, Draw a stem-and-leaf plot for t...

Draw a stem-and-leaf plot for the data set. (Enter numbers from smallest to largest separated by spaces. Enter NONE for stems with no values.) Data set A: The annual wages of emp

cash flow statement, Calculate, CPA, is compiling a cash flow statement fo...

Calculate, CPA, is compiling a cash flow statement for his client, Happy Hal Printing. Over the course of the year Happy Hal acquired new equipment by putting down half of the purc

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