Acca financial Accounting (FA) Study Text ac ca (FA)

Assets

 

=

 

Equity

 

+

Liabilities

2,000

1,000

1,000

 

400 – 300 

100 

0 

––––––––

–––––––– 

–––––––– 

2,100

1,100 

1.000 

9 

 Ledger accounts, debits and credits 

•

Transactions and events are eventually recorded in the relevant ledger

accounts using a double entry to reflect the duality concept explained

previously. There is a ledger account for each asset, liability, equity,

income and expense item.

•

Traditionally each account was drawn as an enlarged 'T' that has two

sides – a debit and a credit side:

Debit 

(Dr)

 

Credit 

(Cr)

 

Name of account e.g. cash, sales 

Date Narrative 

$ Date  Narrative 

$ 

---

Double entry bookkeeping 

54

 

KAPLAN PUBLISHING

 

•

The duality concept means that each transaction will affect at least two

ledger accounts.

•

One account will be debited and the other credited.

•

Whether an entry is to the debit or credit side of an account depends on

the type of account and the transaction: