Financial account

From CNM Wiki
Revision as of 02:07, 9 December 2018 by Gary (talk | contribs) (Rules of debit and credit)
Jump to: navigation, search

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

Main wikipage: Rules of debit and credit
Category Type Normal balance (Increase) Decrease
Principal Assets Debit Credit
Expenses
Withdrawals
Auxiliary Liabilities Credit Debit
Capital
Revenue

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.