Principles of Debit and Credit 1. Cash Sales Cash Balance Side = Debit Sales Balance Side = Debit Cash Balance Side = Credit Sales Balance Side = Credit Cash increases Sales Increases Cash decreases Sales Decreases Debit Cash Debit Sales Credit Cash Credit Sales 2. Charge Sale - on account Sales Balance Side = Debit Accounts Receivable Balance Side = Debit Sales Balance Side = Credit Accounts Receivable Balance Side = Credit Sales increases Accounts Receibable Increases Sales decreases Accounts Receivable Decreases Debit Sales Debit Accounts Receivable Credit Sales Credit Accounts Receivable 3. Made cash payment for rent Cash Balance Side = Debit Rent Expense Balance Side = Debit Cash Balance Side = Credit Rent Expense Balance Side = Credit Cash increases Rent Expense Increases Cash decreases Rent Expense Decreases Debit Cash Debit Rent Expense Credit Cash Credit Rent Expense 4. Paid cash to purchase merchandise for resale Cash Balance Side = Debit Purchases Balance Side = Debit Cash Balance Side = Credit Purchases Balance Side = Credit Cash increases Purchases Increases Cash decreases Purchases Decreases Debit Cash Debit Purchases Credit Cash Credit Purchases 5. Purchased merchandise on account Purchases Balance Side = Debit Accounts Payable Balance Side = Debit Purchases Balance Side = Credit Accounts Payable Balance Side = Credit Purchases increases Accounts Payable Increases Purchases decreases Accounts Payable Decreases Debit Purchases Debit Accounts Payable Credit Purchases Credit Accounts Payable 6. Cash payment on account to a vendor Cash Balance Side = Debit Accounts Payable Balance Side = Debit Cash Balance Side = Credit Accounts Payable Balance Side = Credit Cash increases Accounts Payable Increases Cash decreases Acounts Payable Decreases Debit Cash Debit Accounts Payable Credit Cash Credit Accounts Payable
Principles of Debit and Credit
1. Cash Sales
5. Purchased merchandise on account
6. Cash payment on account to a vendor