Double Entry and Accouting Equation
To increase Asset = Debit
To decrease Asset = Credit
To Increase Liabilities = Credit
To decrease Liabilities = Debit
To Increase Capital = Credit
To decrease Capital = Debit
For example,
The onwer of ABC Furniture starts the business with $50,000 on 1st Jan 2007.
To record this transaction, we need:
- Debit Bank Account with $50,000
- Credit Capital Account with $50,000
The transaction can be recorded in UBS Accounting software as follows:
