Debits & Credits

A sale is made for $100, payment terms are 30 days:

D: Accounts Receivable

C: Accounts Payable

After 28 days, the cash is collected:

D: Cash

C: Accounts receivable

You borrow $100,000 from the bank on a line of credit:

D: Cash

C: Accounts Payable

Purchasing Equipment for Cash: Buy equipment worth $1,000 in cash.

D: PPE

C: Cash

Paying an Expense: Pay $3000 for rent

D: Rent Expense

C: Cash

Borrowing Money from a Bank:

a. The company borrows $5,000 from a bank

D: Cash

C: Accounts Payable

Paying Off Part of a Loan:The company pays $2,000 towards the bank loan.

D: Accounts Payable

C: Cash

Purchasing Inventory on Credit

a. The company buys $3,000 worth of inventory on credit.

D: Inventory

C: Accounts Payable

Depreciating Equipment: The company records $500 depreciation on its equipment for the year

D: Depreciation Expense

C: Accumulated Depreciation

Paying Employee Salaries: company pays $2,500 in employee salaries.

D: Salaries & wages expense

C: Cash

The company issues 1,000 shares of stock at $10 per share, receiving $10,000 in cash.

D: Cash

C: Common Stock

The company declares and immediately pays $1,000 in dividends to shareholders (hint: one account is Retained Earnings)

D: Retained Earnings

C: Cash

The company pays $500 for rent.

D: Rent Expense

C: Cash

The company purchases $2,000 worth of inventory on credit.

D: Inventory

C: Accounts Payable

The company issues 1,000 shares of stock for $10 per share.

D: Cash

C: Common Stock

The company makes a $1,200 sale on credit (payment terms are 30 days).

D: Accounts Receivable

C: Sales Revenue

The company buys a new piece of equipment for $5,000 in cash

D: Equipment

C: Cash

The company takes out a $10,000 long-term loan.

D: Cash

C: Long Term Notes Payable

The company pays back $5,000 to the bank for a long-term loan

D: Long Term Notes Payable

C: Cash

The company pays the bank $50 in interest fees for a loan

D: Interest Expense

C: Cash

The company earns $3,000 in interest income on its savings account.

D: Cash

C: Interest Income

The company sells a building for $50,000

D: Cash

C: Building

Advertising Costs: The company records $2,000 in advertising expenses for the current period.

D: Advertising Expense

C: Accounts Payable

The company purchases office supplies for $400 in cash.

D: Office supplies

C: Cash

The company receives $800 in rental income from a tenant

D: Cash

C: Rental Income

Bond Issue: The company issues a $10,000 bond to raise capital.

D: Cash

C: Bonds Payable