Calling the attention of all aspirant soon to be CPA'S and any other related courses to stop by and read this book.
This is a taglish book for better understanding of explanations.
Read in order to learn. Listen in order to understand.
So what ar...
DEBIT is a formal bookkeeping and accounting term that comes from the Latin word debere, which means “to owe”. The debit falls on the positive side of a balance sheet account, and on the negative side of a result item. A debit either increases an asset or expense account, or decreases a liability or equity account. It is positioned to the left in an accounting entry.
CREDIT is an accounting entry that either increases a liability or equity account, or decreases an asset or expense account. It is positioned to the right in an accounting entry.
A ledger (also known as T-account) is a book where journal entries are made documenting transactions or receipts and disbursements of money or property.
Sa left side ng ledger makikita ang debit and sa right side is si credit. According to the above definition, DEBIT INCREASES ASSETS, EXPENSES, OWNER’S WITHDRAWAL (SOLE PROPRIETOR) AND LOSSES while CREDIT INCREASES LIABLITY AND OWNER’S EQUITY.
Below is an example of ledger:
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As you can see, hindi lahat ng debit ay increase and hindi lahat ng credit ay decrease. It depends on the account. Another thing is, once na nag-debit ka, dabat laging may pares din na credit. We, as accountants, we make all things balance. In every transactions, kung ano ang amount ng nasa debit side ay dapat eqal sa amount ng credit side.
For example, Anne paid in cash her rent for the month of August amounting to 4,000php.
Accounting cycle process:
1. Analyze the transaction- Since nagbayad si Anne, ibig sabihin bumaba ang cash niya at tumaas ang expense niya.
2. Record the transaction in the Journal Debit Rent expense…….. 4,000.00 Credit Cash………… 4,000.00 To record the rent expense for the month of August.
3.Posting to the Ledger
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4. Unadjusted Trial Balance
5. Adjusting Entries
6. Adjusted Trial Balance
7. Financial Statements
8. Closing Entries
9.Post-Closing Trial Balance
10. Reversing Entries (optional step at the beginning of the new accounting period).
Since nasa recording phase pa lang tayo, hanggang step 3 lang muna. At the end of this book, madadaanan natin lahat ng process na ‘yan.
