Rule Debit & Credit Journal & Ledger Video Lecture - SSC CGL Tier 2 - Study

what are the rules of debit and credit
what is debit and credit you might have
said left hand side and right hand side
debit and credit per say they are just
terms in accounting we will call one
side debit that is the left hand side
let us say the assets plus expense side
we will call debit and the liability
side the liabilities plus capital plus
profit that is capital plus income minus
expense or capital liabilities and
income we will call that D credits it in
just two sides we need these two sides
to follow the rules of double entry and
record transactions remember what is
accounting it is recording in a
significant manner in a significant
manner which is nothing but the double
entry system so we are framing the rules
for this double entry you have decided
to call the left hand side the debit
side asset and expenses if you remember
a set plus expenses we had already said
asset plus expenses is equal to be set
on the other side liabilities plus
liability I am including capital
liability is including liability to
owner and liability to outside if this
is the case in the simplest form a
certain expenses on one side the Spay
asset is treated the same rule will
apply to expense
similarly the way liability is treated
the same rule will apply to income so
the rules are like this whenever there
is an increase in asset that is debited
that is negative so when cash comes in
if cash of the business is decreased as
it increases we will debit cash we will
open what is called
akhom and debit cash debit cash increase
in assets our debits if increase in
asset is there bit decrease in asset is
credit decrease in SI discredit so when
we pay cash when we pay cash and cash
comes down we are going to credit cash
all we need to remember is an increase
in an asset we will debit that
particular account now what do we mean
by an account and account each each item
whether it's cash whether it's a debtor
whether it's a creditor whether it's
furniture whether it's sale whether it's
purchase all these are represented by an
account is represented by an account so
increase in assets our debits decrease
in assets would therefore be credits and
the rule would just be the opposite for
liabilities and incomes so increase in
liabilities would become credits
whereas decrease in liabilities would be
debits whatever happens to asset happens
to an expense therefore increase in
expenses our debits whatever happens to
liability happens to income therefore
increase in incomes are currents to
summarize if we put it like this asset
liability debit and credit this top
corner the first one if you remember is
plus the rest of it will fall into this
so increase in assets on debits
therefore decrease has to be a credit
liability if there is a increase in
liability it will be a credit but if
there is a decrease it would be a debit
if that will decrease in liability debit
sometimes we use this to remember easily
this score night we remember one karma
as a debit increase increases plus as a
debit plus rest of it words fall into
place
would be the flavors decrease in a
separate automatically we have credit
but increase in liability increase in
liability is a decrease in liability
debit of course whatever happens to the
asset also happens to the expense
whatever happens to liability also
happens to income just expanding the
same we get asset increase in assets our
Evans increase in expense are also
debits
therefore decrease in asset our credit
decrease in expenses credit but in case
of liability and income reverses the
case that means decreases in liability
and the liability comes down it's a
debit income comes down it's a debit
comes down it's an ethic but when it
goes up increase in liability we will
credit increase in income we will