Lesson 5: Understanding the Basic Accounting Equation Flashcards
1
Q
Rule of Debit and Credit
Increase when debited; Decrease when credited
A
Debit (Left Hand Side)
2
Q
Rule of Debit and Credit
Decrease when debited; Increase when credited
A
Credit (Right Hand Side)
3
Q
Accounting Equation
A
Assets = Liabilities + Capital
4
Q
where Capital:
A
Beginning Capital \+Additional Capital -Drawing \+Revenue Net Income/ -Expenses Net Loss
5
Q
Assets = Liabilities + Capital
A
Balance Sheet Accounts
6
Q
(Beginning Capital \+Additional Capital \+Net Income (Revenue – Expenses) -Drawing)
A
Capital Statement Account
7
Q
(Revenue – Expenses)
A
Income Statement Accounts
