Debit credit meaning4/29/2023 ![]() This results from the standard form of a record: it is always valid and is “ debit to credit.” A posting can also address several accounts on one side or the other. ![]() The opposite sides of the two accounts are always balanced. Only positive amounts are posted – either left (debit) or right (credit). However, the concept of debit and credit also means that there are (in principle) no negative values in double-entry bookkeeping – unlike on the account statement of your bank account, for example. The term “double-entry accounting” derives from the fact that this accounting method affects two separate accounts, as an account has two pages, a debit and credit side. in the event of insolvency) also the business partners, and the state – usually represented by the tax office. ![]() These include, for example, the shareholders of the company, under certain circumstances (e.g. The third parties mentioned in the law are all those who might have a legitimate interest in the business transactions of the respective company. ![]() This means that accounting records the business transactions of an enterprise in numerical values – and according to the principles of proper accounting, this should take place in a timely and factual manner and the transactions must be traceable, with documentation. These principles consist of legal regulations and informal rules and are intended to ensure that the accounts “provide an expert third party with an overview of the business transactions and the situation of the company within a reasonable period of time.” The business transactions must be accountable on both sides of the transaction. The words debit and credit are taken from accounts, or more precisely, from double entry accounts, as they are used in the principles of proper accounting. ![]()
0 Comments
Leave a Reply.AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |