Determining Credit Debit in General Journal

The term credit debit is a characteristic of double entry accounting systems, surely friends have experienced confusion in determining debit and credit when going to do journal entries. In this paper, I will discuss how to easily determine credit debit.


          Definition of Credit Debit
    Debit is accounting when a condition occurs where assets and costs experience an increase (increase), or when the liability (debt / liability) and equity (capital) decrease (decrease). In accounting, the debit is on the left side.
    Credit is accounting records when conditions occur where liability and equity have increased (increased), or assets and costs have decreased (decreased). Credit is the opposite of debit, and is on the right side.

Easy Ways to Determine Credit Debits
To determine debit and credit easily, we must first understand the following two things:

Group or Account Classification

    Assets
    Liabilities
    Owner's Equity
    Income
    Expenses

Account groups 1, 2 and 3 are the accounts contained in the balance sheet financial statements. Whereas, accounts groups 4 and 5 are groups of accounts contained in the income statement financial
 statements.

Opposite Account

That will be the opponent of a transaction, where each transaction will affect at least 2 accounts. For example, on a machine purchase transaction on credit, the affected account is the machine (fixed assets), while the opponent is a business loan (buying on credit).

For groups of accounts in the balance sheet, the rules for determining debit and credit are as follows:

The account group that is to the left (assets), is recorded on the debit side if it is increased and the opponent's account is recorded as credit; and the account group that is on the right (liabilities and owner's equity), recorded credit if it increases and the opponent's account is recorded as a debit.

Example:

    Buying raw materials. Equipment. Equipment. Vehicles in cash. raw materials. Equipment. Equipment. vehicles are assets, if added, it is recorded in the debit position while the opposite account, namely cash is recorded as credit.
    Add capital deposits. The capital deposit is the owner of the equity, if it is increased then the credit is recorded, while the opponent's account, which is cash is recorded as debit.

For groups of accounts in the balance sheet, the rules for determining debit and credit are as follows:

The existing account group on the left (expenses), is recorded on the debit side if it is increased and the opponent's account is recorded as credit; and the account group that is on the right (income), recorded credit if it increases and the opponent's account is recorded as a debit.


Example:

    Paying employee salaries. Employee salaries include expenses, if the increase is recorded debit, while the opponent is recorded credit.

Conclusion

To determine credit debit easily, we must think logically and understand the classification of the account and the account of the opponent from a transaction.

Assets and Expenses are recorded as debit if they increase, while Liabilities, Owner's Equity and Income are recorded as credit if added.