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Learn the meaning and history of debits and credits in double-entry bookkeeping, and how they are used to record changes in value from business transactions. Find out the rules and examples of debits and credits for different types of accounts.
Double-entry bookkeeping is a method of bookkeeping that relies on a two-sided accounting entry to maintain financial information. Every entry to an account requires a corresponding and opposite entry to a different account, based on the principle of debit and credit.
The accounting equation is the foundation for the double-entry bookkeeping system and the cornerstone of the entire accounting science. It states that assets minus liabilities equals equity, and it can be applied to various transactions and financial statements.
A journal entry is the act of recording transactions in an accounting journal that shows debits and credits. Learn about the types of accounts, the golden rules of accounting, and how to record journal entries in accounting software.
A general ledger is a bookkeeping ledger that aggregates accounting data from journals and subledgers. It contains accounts for assets, liabilities, equity, revenue, expenses, gains and losses, and is used to prepare financial statements.
A ledger is a book or collection of accounts where accounting transactions are recorded. Learn about the different types of ledgers, such as sales, purchase and general ledger, and their origin and etymology.
Bookkeeping is the recording of financial transactions, and is part of the process of accounting in business and other organizations. Learn about the origin, methods, and steps of bookkeeping, as well as the related professions and terms.
A trial balance is a list of the adjusted closing balances of all the general ledger accounts in a business as at a specific date. It is used to check the accuracy of the double-entry bookkeeping system and to prepare financial reports.