Basic Accounting
Post journals and a trial balance
What you will learn
Post both sides of a transaction and check the ledger totals.
Total debits = total credits
A journal records the accounts affected, the amounts and the transaction date. Assets and expenses normally increase with a debit. Liabilities, equity and revenue normally increase with a credit. The trial balance checks whether ledger debits equal credits. A transaction posted to two wrong accounts can still balance. A fictional Pune workshop buys ₹40,000 of equipment for cash. Debit equipment and credit cash by ₹40,000. Total assets stay constant.
A fictional Pune workshop buys ₹40,000 of equipment for cash. Debit equipment and credit cash by ₹40,000. Total assets stay constant.
A journal records the accounts affected, the amounts and the transaction date. Assets and expenses normally increase with a debit. Liabilities, equity and revenue normally increase with a credit. The trial balance checks whether ledger debits equal credits. A transaction posted to two wrong accounts can still balance. A fictional Pune workshop buys ₹40,000 of equipment for cash. Debit equipment and credit cash by ₹40,000. Total assets stay constant.
Which account is credited on a credit purchase of inventory?