Table of Contents

    Debit & Credit Rules for Basic Accounting Elements

    Rumman Ansari September 24, 2025 223 views

    📘 General Journal Entries (Basic Accounting Elements)

    Element Transaction Example Journal Entry Explanation
    Assets Purchased Machinery for $10,000 in Cash Machinery A/c Dr. 10,000
    To Cash A/c Cr. 10,000    		 Machinery (Asset ↑ → Debit), Cash (Asset ↓ → Credit)
    Liabilities Took Bank Loan $5,000 Cash A/c Dr. 5,000
    To Bank Loan A/c Cr. 5,000    		 Cash (Asset ↑ → Debit), Loan (Liability ↑ → Credit)
    Equity (Capital) Owner invested $20,000 Cash Cash A/c Dr. 20,000
    To Capital A/c Cr. 20,000    		 Cash (Asset ↑ → Debit), Capital (Equity ↑ → Credit)
    Revenue / Income Earned Service Revenue $2,000 in Cash Cash A/c Dr. 2,000
    To Service Revenue A/c Cr. 2,000    		 Cash (Asset ↑ → Debit), Revenue (Income ↑ → Credit)
    Expenses / Losses Paid Rent $1,000 Rent Expense A/c Dr. 1,000
    To Cash A/c Cr. 1,000    		 Rent (Expense ↑ → Debit), Cash (Asset ↓ → Credit)

    🔹 Quick Rules Recap

    • Assets → Debit increase, Credit decrease

    • Liabilities → Debit decrease, Credit increase

    • Equity (Capital) → Debit decrease, Credit increase

    • Revenue → Debit decrease, Credit increase

    • Expenses → Debit increase, Credit decrease

    ✅ This table covers all basic elements with journal entries.