Well, this issue is not so simple. There are rules for debiting and crediting, depending on the account (assets or liabilities) and you have to lern them...I'll try to give you an example:
- as main rule, the left side of an accounting note is called "debit" an the right one is called "credit";
- an accounting note shows like that:
sum/ value debit account = credit account sum/ value
- suppose you buy some goods from a supplier and you have to pay them after 30 days; the goods value is 1000 eur;
- when you receive the goods and the invoice, the accounting note is:
1000 goods account = vendor account 1000, meaning that your stock increased an your debt for the vendor increased, too, with 1000 eur (goods account was debited and vendor account was credited);
- after 30 days, when you pay the debt to the vendor, you will have:
1000 vendor account = bank account 1000, meaning that your debt to the vendor increased with 1000 eur and the money from your bank increased with 1000 eur, too( the vendor account was debited and his balance is 0 and the bank account was credited).
Hope it helps and please assign points!
