T-Accounts (2.3)

T-Account

A shorthand method of displaying journal entries and balances within individual accounts, used for planning rather than posting actual records.

Side of a T-Account for Debits

Always on the left side.

Side of a T-Account for Credits

Always on the right side.

Where Totals/Balances go in a T-Account

At the bottom; the difference goes on the side where the totals are larger (debit or credit excess).

At the bottom; the difference goes on the side where the totals are larger (debit or credit excess).

Debit Cash ($10,000) and Credit Owner's Capital ($10,000).

T-Account Entry for Cash Sale

Debit Cash and Credit Revenue.

T-Account Entry for Expense Payment

Debit Salaries Expense and Credit Cash.

T-Account Entry for Purchase on Account

Debit Inventory and Credit Accounts Payable.