Difference between revisions of "Financial account"
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A [[financial account]] (or, simply, [[account]]; hereinafter, the ''Account'') is an accounting device used in [[bookkeeping]] to record increases and decreases of business transactions relating to [[assets]], [[liabilities]], [[capital]], [[withdrawals]], [[revenue]], and/or [[expenses]]. In other words, the ''Account'' is the [[concept]] that is used to record financial entries of a similar nature such as cash increases (debits) and decreases (credits) or, vice versa, [[accounts payable]] increases (credits) and decreases (debits). | A [[financial account]] (or, simply, [[account]]; hereinafter, the ''Account'') is an accounting device used in [[bookkeeping]] to record increases and decreases of business transactions relating to [[assets]], [[liabilities]], [[capital]], [[withdrawals]], [[revenue]], and/or [[expenses]]. In other words, the ''Account'' is the [[concept]] that is used to record financial entries of a similar nature such as cash increases (debits) and decreases (credits) or, vice versa, [[accounts payable]] increases (credits) and decreases (debits). | ||
| − | ==Rules of debit and credit== | + | ==Journalizing== |
| + | :''Main wikipage: [[Journalizing]]'' | ||
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| + | ===Rules of debit and credit=== | ||
{|class="wikitable" width=50% style="float:right; margin-left:10px; text-align:center;" | {|class="wikitable" width=50% style="float:right; margin-left:10px; text-align:center;" | ||
|+[[Rules of debit and credit]] | |+[[Rules of debit and credit]] | ||
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*[[Principal account]]s, which are [[assets]], [[withdrawals]], and [[expenses]], are debited when they increase and credited when they decrease. | *[[Principal account]]s, which are [[assets]], [[withdrawals]], and [[expenses]], are debited when they increase and credited when they decrease. | ||
*[[Beneficiary account]]s, which are [[liabilities]], [[capital]], and [[revenue]], are debited when decrease and credited when they increase. | *[[Beneficiary account]]s, which are [[liabilities]], [[capital]], and [[revenue]], are debited when decrease and credited when they increase. | ||
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| + | ===Adjusting accounts=== | ||
| + | ::''Main wikipage: [[Adjusting account]]'' | ||
==Chart of accounts== | ==Chart of accounts== | ||
:''Main wikipage: [[Chart of accounts]]'' | :''Main wikipage: [[Chart of accounts]]'' | ||
Every [[organization]] can establish its own list of account titles, which is called the [[chart of accounts]]. | Every [[organization]] can establish its own list of account titles, which is called the [[chart of accounts]]. | ||
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Revision as of 19:44, 9 December 2018
A financial account (or, simply, account; hereinafter, the Account) is an accounting device used in bookkeeping to record increases and decreases of business transactions relating to assets, liabilities, capital, withdrawals, revenue, and/or expenses. In other words, the Account is the concept that is used to record financial entries of a similar nature such as cash increases (debits) and decreases (credits) or, vice versa, accounts payable increases (credits) and decreases (debits).
Journalizing
- Main wikipage: Journalizing
Rules of debit and credit
| Category | Type | Normal balance (or increase) | Decrease |
|---|---|---|---|
| Principal accounts |
Assets | Debit | Credit |
| Expenses | |||
| Withdrawals | |||
| Beneficiary accounts |
Liabilities | Credit | Debit |
| Revenue | |||
| Capital | |||
| Adjusting accounts |
Any | Behave oppositely to the Accounts that they adjust | |
- Main wikipage: Rules of debit and credit
- Principal accounts, which are assets, withdrawals, and expenses, are debited when they increase and credited when they decrease.
- Beneficiary accounts, which are liabilities, capital, and revenue, are debited when decrease and credited when they increase.
Adjusting accounts
- Main wikipage: Adjusting account
Chart of accounts
- Main wikipage: Chart of accounts
Every organization can establish its own list of account titles, which is called the chart of accounts.
