Your past questions in my database, your written emails and your written comments has motivated me to write journal entries examples – part 2. So, I spent almost this Aug. month for studying, searching and writing the journal entries examples which I could not write in the first part of journal entries examples. Following journal entries are used in different areas of businesses. But rules for passing the journal entries will always be same.
1. When you see that there is increase in the asset of your asset, you should debit the account. When you see any decrease liability and equity, you should also debit the account. When you see the decrease in the asset, you should credit that asset. When you see the increase in liability and equity, you should credit the account.
2. Equity means capital. All the expenses are the decrease the equity, so we debit all the expenses. All incomes, gain and revenues increase our equity, so, we credit all the incomes, gains and revenues.