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30 Cards in this Set

  • Front
  • Back
Investment by owner
Debit- cash
Credit- common stock
Purchase supplies for cash
Debit-Supplies
Credit- cash
Purchase equipment for cash
Debit-Equipment
Credit- cash
Purchase supplies on credit
Debit-Supplies
Credit- accounts payable
Provide services for cash
Debit-Cash
Credit- revenue
Payment of expenses cash
Debit- type of expense
Credit- cash
Provide services for credit
Debit-Accounts receivable
Credit- revenue
Receive a payment from accounts receivable
Debit-Cash
Credit- accounts receivable
Payment of accounts payable
Debit-Accounts payable
Credit- cash
Payment of cash dividend
Debit-Dividend
Credit- cash
Payment of cash from customer for future services
Debit- cash
Credit- unearned revenue
Pay cash for future insurance coverage (prepay for insurance)
Debit- prepaid insurance
Credit- cash
Assets =
Liability + Equity
Other parts of equity are
+revenue
-expenses
+common stock
-dividends
Left side of an account:
Debit side
Right side of an account:
Credit side
Account balance is
Difference between the total debits and total credits recorded in an account
Normal Balance side for Liabilities and Equities
Right side/credit side
Equity increases from
Revenues and stock issuances
Equity decreases from
Expenses and dividends
Assets are
Resources owned or controlled by a company

Cash, accounts receivable, note receivable, prepaid accounts, supplies, equipment, buildings, land
Liabilities are
Creditors' claims on assets

Accounts payable, note payable, unearned revenue, accrued liabilities
Equities are
Common stock, dividends, revenues, and expenses
Ledger accounts
Sum of all the accounts a company uses
Increases (credits) to common stock and revenues:
Increase Equity
Increases (debits) to dividends and expenses:
Decrease Equity
Total amount that is debited to accounts must equal
The total amount credited to accounts for each transition.