Chapter 4.2--Debit and credit theory

Question 1

Debit

Answer 1

the word associated with the LEFT side of an account

Question 2

Credit

Answer 2

The word associated with the RIGHT side of an account

Question 3

Double Sided Accounting

Answer 3

Every transaction is recorded in the accounts in two steps

It is recorded first as a debit ( or debits) and second as a credit ( or credits)

so that the total of the debit entries equals the total of the credit entries

This system is used in the business world

Question 4

T-account

Question 5

Asset

Answer 5

-DEBIT SIDE
-INCREASE ON THE DEBIT SIDE
DECREASE ON THE CREDIT SIDE

Question 6

LIABILITY
OWNER’S EQUITY

Answer 6

-CREDIT SIDE
-INCREASE ON THE CREDIT SIDE
-DECREASE ON THE DEBIT SIDE

Question 7

INFORMATION OF T-ACCOUNT

Answer 7

NAME OF ACCOUNT(written at the top)
-the dollar value of the account and an indication of whether the value of the account is a debit or a credit