Hi Every one

Can u please explain this

0 = Dr Assets Cr Owners' Equity Cr Liabilities

. _____________________________/\____________________________ .

. / Cr Retained Earnings (profit) Cr Common Stock \ .

. _________________/\_______________________________ . .

. / Dr Expenses Cr Beginning Retained Earnings \ . .

. Dr Dividends Cr Revenue . .

\________________________/ \_________________________________________________ _____/

increased by debits increased by credits

Crediting a credit

Thus -------------------------> account increases its absolute value (balance)

Debiting a debit

Debiting a credit

Thus -------------------------> account decreases its absolute value (balance)

Crediting a debit

From India , Bangalore
Hi Deepti Really i an not understanding any thing thing in thing da any ways if u get any answer just forward it to my id too Thanks Regards, Manjunath.T

The answer for the quote which i have posted earlier is this

The accounting equation (Assets = Liabilities + Owners' Equity) and financial statements are the main topics of financial accounting.

The trial balance which is usually prepared using the Double-entry accounting system forms the basis for preparing the financial statements. All the figures in the trial balance are rearranged to prepare a profit & loss statement and balance sheet. There are certain accounting standards that determine the format for these accounts (SSAP, FRS, IFS). The financial statements will display the income and expenditure for the company and a summary of the assets, liabilities, and shareholders or owners’ equity of the company on the date the accounts were prepared to.

Assets, Expenses, and Withdrawals have normal debit balances (when you debit these types of accounts you add to them)...remember the word AWED which represents the first letter of each type of account.

Liabilities, Revenues, and Capital have normal credit balances (when you credit these you add to them).

From India , Bangalore

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