Adding and subtracting with debits and credits

Debits and credits affect the accounts differently. some accounts are increased by debits. while others are increased by credits. see how debits and credits affect accounts.

Asset

• Increases - Debit Entry impact 
• Decreases-Credit Entry Impact

Equity     

• Decreases- Debit Entry impact                              
• Increases-  Credit Entry Impact

Liability 

• Decreases-Debit Entry impact
• Increases- Credit Entry Impact

Revenue                               

• Decreases-Debit Entry impact                           
• Increases- Credit Entry Impact

Expense                               

• Increases- Debit Entry impact                              
• Decreases-Credit Entry Impact

Final Accounts

Final Accounts include trading and profit and loss account or revenue account, balance sheet, statement of changes in equity, cash flow statement, and other statements and notes related to above. you should understand that the trial balance is prepared by copying balances from ledger accounts and it is from the ledger account balances we should prepare the trading and profit and loss account and balance sheet and nothing to do with books of prime entry. the purpose of preparing the trading and profit and loss account is to ascertain whether the business made a profit or loss after doing business for a certain period. here there is a tie period. you can prepare the above revenue account for

Useful International Business Word

• Foreign Capital  
• Foreign Companies 
• Foreign Competitors 
• Foreign Consumers  
• Foreign Control 
• Foreign Customs