![]() ![]() ![]() Equity Account:This is the total value of a company’s operational assets after the clearance of all the liabilities.invoices for vendors, bills, tax, bank fees, other payables, etc. Liability Account:These are the dues that a company is required to pay back, in other words, the financial obligations that are pending on an organization.If a debit occurs in a debit account, then the company loses money. E.g., interest or investment income, sales and/or service revenue, etc. In either of these, a debit or credit can occur. This may also include interest from other investments. Credits, abbreviated as Cr, are the other side of a financial transaction and they are recorded on the right-hand side of the accounting journal. Revenue Accounts: Keeps track of the income earned from the sales, i.e., products and/or services. Debits, abbreviated as Dr, are one side of a financial transaction that is recorded on the left-hand side of the accounting journal.E.g., utilities, salaries, rent, travel expenses, etc. Expense Accounts:Keeps track of the charges that are used in the company’s day-to-day operations.E.g., inventory, cash, vehicles, equipment and/or property, receivable accounts, etc. Asset Accounts:Keeps track of items that will provide economic benefit to the company in the future.Debit A debit (DR) is an entry made on the left side of an account. If a debit increases an account, you must decrease the opposite account with a credit. There are 5 major accounts in a company’s chart, which includes: Debits and credits are equal but opposite entries in your books. As previously stated, they are essentially used for recording transactions in an organization or company’s chart of an account, which basically classifies income and expenses. ![]()
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