When you record an accounting transaction, you need to make a debit to one account and a credit to another. And the total amount you debited should also be equal to the amount you credited.
If you’re not familiar with the rules of debit and credit, the whole process can be tricky. If you’re new to recording transactions in your books, here’s a cheat sheet to help you understand debits and credits.
What is the Normal Balance?
All accounts — assets, liabilities, revenues, expenses, owner’s capital — have a normal balance. This normal balance could either be debit or credit.
When the normal balance of an account is debit, it will increase every time you debit that account. Meanwhile, a credit to that account will decrease the total balance.
These accounts are said to be “normal,” as debits increase and credits decrease these accounts.
All asset accounts have a normal debit balance. This means that every time you acquire an asset, you need to make a debit to that account. Alternatively, when you use, spend or dispose of an asset, you need to credit that account.
Here’s a quick example.
You paid $100,000 cash to buy land. So, to record the transaction, do the following:
Debit: Land $100,000
Credit: Cash $100,000
With this entry, you can add the land you acquired to your books. At the same time, you recorded how much cash you paid for the land.
As a result, the cash in your books will decrease and total land you own will increase.
Asset accounts include current assets including cash, accounts receivable, and inventory and long-term assets like land and equipment.
Contra-asset accounts like Accumulated Depreciation and Allowance for Doubtful Accounts have a normal credit balance.
Liability accounts which include items like loans payable and accounts payable have a normal credit balance. Every time you credit a liability account, it will increase. A debit, on the other hand, will decrease the account.
Let’s assume that you took out a $50,000 loan to buy new equipment for your business.
To record this transaction, you need to:
Debit: Equipment $50,000
Credit: Loans Payable $50,000
The debit to equipment will increase the total equipment in your books.
Since you took out a loan, you also need to record the increase in the loans your business owes. You can do this by simply debiting the loans payable account.
Revenue accounts which include all income accounts have a normal credit balance. When you recognize income from your business, you need to credit this account.
For instance, a client paid you $5,000 for the consulting service you provided. You need to record this transaction with the following entry.
Debit: Cash $5,000
Credit: Consulting Revenue $5,000
Now, if your agreement allows the client to pay a few days later, you may record the transaction by debiting Accounts Receivable and crediting the same account Consulting Revenue.
Debit: Accounts Receivable
Credit: Consulting Revenue
Just like cash, Accounts Receivable is an asset account.
Once you receive the payment from the customer, you can record the payment through the following entry:
Credit: Accounts Receivable
Like liability accounts, expenses a normal debit balance. This means that when you record any relevant cost related to operating your business, you need to debit that account.
For instance, you received the electric bill and you paid for it right away. You can enter the transaction through this entry:
Debit: Utilities – Electricity
All other expenses such as Rent, Salaries, Repairs, and Maintenance should be debited every time you make a payment or recognize an expense.
Now, what if you did not pay an expense in cash?
If you did not pay the expense in cash but you want to record it, you can use the accounts payable account.
For instance, purchasing office supplies from a store which allows you to pay for the items at the end of the month. You can still record the entry as follows:
Credit: Accounts Payable
When you decide to pay for the supplies, you have to make this entry:
Debit: Accounts Payable
The owner’s capital account (Partnership Equity for partnerships and Shareholders Equity for corporations) has a normal credit balance. Any investment you put down as initial capital will be recorded in this account.
If you started the business with an initial cash investment of $20,000, you need to record the transaction through this entry:
Debit: Cash $20,000
Credit: Owner’s Capital $20,000
When you make a cash withdrawal and you don’t maintain a drawing account, you need to record the transaction as follows.
Debit: Owner’s Capital
Most of the time, sole proprietors who want to track their withdrawals create an owner’s drawing account. Like expense accounts, the owner’s drawing has a normal debit balance.
Each time you withdraw cash funds from your business for personal use, you need to do this entry:
Debit: Owner’s Drawing
The owner’s Drawing is only a temporary account.
At the end of the year, the owner’s drawing will be closed to the owner’s capital account.
Debit: Owner’s Capital
Credit: Owner’s Drawing
After completing this step, the Owner’s Drawing account should be zero and the Owner’s Capital should now reflect the net amount of investments and withdrawals for the year.
Dealing with Complicated Transactions
With this guide, you should be more familiar with how to record transactions in your books. You can also consult the chart of accounts if you’re not sure if an account is an asset, a liability, a revenue or an expense. But if you find the whole process tedious or too complicated, hiring a bookkeeper may be the best choice.
Wakati wa kurekodi shughuli ya uhasibu, unahitaji kufanya debit kwa akaunti moja na mikopo kwa nyingine. Kiasi cha jumla cha malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo ya malipo. Kama wewe si ukoo na sheria ya debit na mikopo, mchakato mzima inaweza kuwa tricky. Kama wewe ni mpya kwa kurekodi shughuli katika vitabu yako, hapa ni cheat karatasi kukusaidia kuelewa debits na mikopo. Usawa wa Kawaida Ni Nini? Akaunti zote - mali, madeni, mapato, gharama, mtaji wa mmiliki - zina usawa wa kawaida. Hii usawa wa kawaida inaweza kuwa ama debit au mikopo. Wakati usawa wa kawaida wa akaunti ni debit, itaongezeka kila wakati wewe debit akaunti hiyo. Wakati huohuo, mkopo kwenye akaunti hiyo utapunguza jumla ya usawa. Akaunti hizi zinasemekana kuwa "kawaida", kwani debiti huongezeka na mikopo hupungua akaunti hizi. Akaunti zote za mali zina usawa wa kawaida wa deni. Hii inamaanisha kwamba kila wakati unapopata mali, unahitaji kufanya malipo kwenye akaunti hiyo. Vinginevyo, wakati wewe kutumia, kutumia au kuondoa mali, unahitaji kuhamisha akaunti hiyo. Hapa ni mfano wa haraka. Alipewa dola 100,000 kwa fedha za fedha za fedha za kununua ardhi. "Kama unavyoona, ""Debit: Land: $ 100,000 Credit: Cash: $ 100,000"" ni njia ya kuingiza fedha kutoka kwa mkopo wa ardhi na kuingiza fedha kutoka kwa mkopo wa ardhi." Wakati huohuo, ulirekodi kiasi cha pesa ulicholipa kwa ajili ya ardhi hiyo. Matokeo yake, fedha katika vitabu vyako itapungua na jumla ya ardhi unayomiliki itaongezeka. Akaunti za mali ni pamoja na mali ya sasa ikiwa ni pamoja na fedha, akaunti za kupokea, na hesabu na mali ya muda mrefu kama ardhi na vifaa. Akaunti za kukabiliana na mali kama vile Accumulated Depreciation na Allowance kwa Akaunti za Mashaka zina usawa wa kawaida wa mkopo. Akaunti za dhima ambazo ni pamoja na vitu kama mikopo inayopaswa kulipwa na akaunti zinazopaswa kulipwa zina usawa wa kawaida wa mkopo. Kila mara unapokopesha akaunti ya dhima, itaongezeka. Debit, kwa upande mwingine, itapunguza akaunti. Kwa mfano, fikiria kwamba umekopa pesa za dola 50,000 ili kununua vifaa vipya kwa ajili ya biashara yako. Kwa mfano, kama unafanya shughuli ya Debit: Vifaa $ 50,000; Mkopo: Mikopo ya $ 50,000; Debit: Vifaa $ 50,000; na Debit: Vifaa $ 50,000; na Debit: Vifaa $ 50,000; na Debit: Vifaa $ 50,000. Kwa kuwa umepata mkopo, unahitaji pia kurekodi ongezeko la mikopo ambayo biashara yako inadaiwa. Unaweza kufanya hivyo kwa kuchaji tu akaunti ya mikopo inayopaswa kulipwa. Akaunti za mapato ambazo ni pamoja na akaunti zote za mapato zina usawa wa kawaida wa mkopo. Unapokubali mapato kutoka kwa biashara yako, unahitaji kuidhinisha akaunti hii. Kwa mfano, mteja alikulipa $ 5,000 kwa huduma ya ushauri uliyotoa. Unahitaji kurekodi shughuli hii na kuingia zifuatazo. Debit: Cash: $ 5,000; Credit: Consulting: $ 5,000; Sasa, ikiwa makubaliano yako yanaruhusu mteja kulipa siku chache baadaye, unaweza kurekodi shughuli kwa debiting akaunti za kupokea na kuikopesha akaunti hiyo ya mapato ya ushauri. Debit: Akaunti za Kupokea Mikopo: Consulting Mapato Kama vile fedha taslimu, Akaunti za Kupokea ni akaunti ya mali. Baada ya kupokea malipo kutoka kwa mteja, unaweza kurekodi malipo kupitia kiingilio hiki: Mikopo: Akaunti za Kupokea Kama akaunti za dhima, gharama, usawa wa kawaida wa malipo. Hii inamaanisha kwamba wakati wa kurekodi gharama yoyote muhimu inayohusiana na kuendesha biashara yako, unahitaji debiting akaunti hiyo. Kwa mfano, unaweza kuagiza gharama za umeme na kulipa mara moja. Unaweza kuingia shughuli kupitia kuingia hii: Debit: Utilities <unk> Umeme Gharama nyingine zote kama vile kodi, mishahara, ukarabati, na matengenezo inapaswa debited kila wakati kufanya malipo au kutambua gharama. Lakini vipi ikiwa unalipa gharama kwa fedha? Ikiwa haujali gharama kwa fedha, lakini unataka kuorodhesha, unaweza kutumia akaunti ya malipo. Kwa mfano, kununua vifaa vya ofisi kutoka duka ambalo hukuruhusu kulipa vitu hivyo mwishoni mwa mwezi. "Kama unavyoweza kuona, ""Mashirika ya Uwekezaji"" ni moja ya njia za kuanzisha akaunti ya mkopo, na ""Mashirika ya Uwekezaji"" ni moja ya njia za kuanzisha akaunti ya mkopo, na ""Mashirika ya Uwekezaji"" ni moja ya njia za kuanzisha akaunti ya mkopo." Uwekezaji wowote unaoweka chini kama mtaji wa awali utaandikwa katika akaunti hii. Ikiwa biashara yako imeanza na uwekezaji wa awali wa $ 20,000, unahitaji kurekodi shughuli kupitia kiingilio hiki: Debit: Cash $ 20,000; Mkopo: Mmiliki wa Mtaji: $ 20,000; Wakati unafanya uondoaji wa fedha na huna akaunti ya kuchora, unahitaji kurekodi shughuli kama ifuatavyo: Debit: Mmiliki wa Capital Wakati mwingi, wamiliki wa pekee ambao wanataka kufuatilia withdrawals yao kuunda mmiliki wa akaunti ya kuchora. Kama akaunti za gharama, mchoro wa mmiliki una usawa wa kawaida wa deni. Wakati wowote unapoondoa fedha kutoka kwa biashara yako kwa matumizi ya kibinafsi, unahitaji kufanya kiingilio hiki: Debit: Mchoro wa Mmiliki Mchoro wa Mmiliki ni akaunti ya muda tu. Mwishoni mwa mwaka, mchoro wa mmiliki utafungwa kwa akaunti ya mtaji wa mmiliki. Debit: Mmiliki wa Mji Mkopo: Mmiliki wa Drawing Baada ya kukamilisha hatua hii, Mmiliki wa Drawing akaunti inapaswa kuwa sifuri na Mmiliki wa Mji Mkopo sasa inapaswa kuonyesha kiasi cha usafi wa uwekezaji na uondoaji kwa mwaka. Kuchukua hatua ya kuharakisha shughuli za biashara, kwa kutumia mwongozo huu, unaweza kupata maelezo zaidi juu ya jinsi ya kuharakisha shughuli za biashara katika vitabu vyako. Unaweza pia kushauriana chati ya akaunti kama huna uhakika kama akaunti ni mali, dhima, mapato au gharama. Lakini ikiwa unaona utaratibu huo wote kuwa wenye kuchosha au wenye kutatanisha sana, huenda uajiri wa mwandishi wa vitabu ukawa chaguo bora zaidi.