Debit and Credit
✏️ In one line
Every transaction has two equal sides: a debit (Dr, the left side) and a credit (Cr, the right side).
📖 Story time
- Meera pays ₹2,000 rent in cash.
- Rent is an expense, and it went up. Expenses go up on the debit side, so: debit Rent.
- Cash is an asset, and it went down. Assets go down on the credit side, so: credit Cash.
- ₹2,000 on each side. Debits always equal credits.
| Type of account | When it goes up | When it goes down |
|---|---|---|
| Assets | Debit | Credit |
| Expenses | Debit | Credit |
| Liabilities | Credit | Debit |
| Capital | Credit | Debit |
| Income / Revenue | Credit | Debit |
🎯 Your turn
Sort each increase into Debit or Credit.
Drag each card into a box, or tap a card and then a box.
Nice! Great sorting! Assets and expenses increase on the debit side; liabilities, capital and income increase on the credit side.
Not quite. Hint: Assets and expenses go up as debit. The other three go up as credit.
Meera buys goods for cash. Which account is debited?
Nice! Correct! Purchases go up, so it's debited. Cash goes down, so it's credited.
Not quite. Hint: What came into the shop?
For every transaction, total debits must equal total credits.
Nice! True. That is the heart of double-entry bookkeeping.
Not quite. Hint: Remember the rent: ₹2,000 on each side.
Meera: Meera pays her helper a salary of ₹5,000 in cash.
What is the entry?
Nice! Yes. Salary is an expense that went up (debit), and cash went down (credit).
Not quite. Hint: It works just like the rent example.