Golden rules of Debit Credit And Entry

debit vs credit

debit vs credit

The two words have been derived from French and latin languages. Here debet , a middle French word and debitum ,a latin word which mean to owe or that which is owed because debit  which we abbreviate  as Dr . Same is the story of credit or creditum which mean that which is entrusted or loaned. It is abbreviated as cr. You can see your debits and credits within your bookkeeping records which is commonly written as left side and right side accounting. A Debit is a bookkeeping term. According to Bookkeeping term, there is  the increase in the value of assests and there is the decrease in the value of liabilities. These are based on Double entry system.  For example- if a company takes payment ,it  is to be treated a debit because it is increasing their cash flow, which is an assests. If  you make a payment  toward a bill,  it is also known a debit  because it is reducing a liabilities. A credit can also mean a decrease in expenses.

In simple word (1) In capital a/c, Debit side will be decreased and credit side will be increased.

(2) In Assests a/c,Debit side will be increased and  credit side will be decreased.

(3) In Liabilities a/c Debit side will be decreased and credit side will be increased.

(4) IN Expenses a/c , Debit side will be increased and credit side will be decreased.

(5) In income a/c ,Debit side will be decreased and credit side will be increased.

By the way Six rules is followed in it, which are as follows:

In personal account , receiver will be debited.

In personal account , giver will be credited.

In Real account, incoming will be debited.

In Real account ,outgoing will be credited.

In nominal account, expenses will be debited.

In nominal account , income will be credited.


We will discuss about entry.How will You do entry.What is the statement for doing entry? What is entry?or DO you know about entry? In previous post, You are familiar with golden rules of debit and credit. We will talk about this rules:
See the example about this rules:
1.Started business with capital RS100000
Entry- cash
Cash is real account but capital is personal.
Golden rules- cash is incoming but capital is outgoing.
Cash will be debited but capital will be credited.

2. Purchased goods from mohan Rs 100
ENTRY- 1.purchases 2.mohan
purchases is nominal account but mohan is personal account.
Golden rules- Purchases a/c will be expenses and Mohan will be personal account.
Purchases account will be debited and Mohan will be credited.
3.Sold goods to Mohan Rs 200
Entry- 1. MOHAN 2. sales
Mohan is personal account but Sales is nominal account.
Golden rules- Mohan is receiver but Sales is income.
Mohan will be debited and sales will be credited.
4.Deposited in to bank rs 10000
ENTRY- 1. bank 2 cash
Bank is personal account but cash is real account.
Golden rules- Bank is receiver and cash is outgoing.
Bank will be debited and cash will be credited.
5. Withdrawn cash from bank for personal use
Entry- Drawing 2 Bank
Drawing is personal account but Bank is personal account.
Golden rules-Drawing is receiver and Bank is giver.
Drawing will be debited but Bank will be credited.
6.Withdrawn cash from bank for office use. 2 Bank
Cash is real account and bank is personal account.
Golden rules- cash is incoming and Bank is giver .
Cash will be debited and Bank will be credited.
7. salaries paid.
Entry-1. salaries 2. cash
Salaries are nominal account and cash are real account.
Golden rules- Salaries is expenses and cash is outgoing.
salaries will be debited and cash will be credited.
8. Salaries received.
Entry- cash 2. salaries
Explain- Cash is real account and salaries are nominal account.

GOLDEN RULES-  Cash is incoming and salaries is income.
Cash will be debited and salaries will be credited.

9. Commission received.
Explain- Two accounts are affecting in it. Which  are as follows 1 cash 2. commission
Cash is real account and commission is nominal account .CASH will be debited and commission will be credited.
10.Purchased furniture from mohan rs 10000.
FURNITURE is real account and Mohan is giver.
Furniture will be debited and Mohan will be credited.

See the examples below for understanding nominal account:

for Debit side                               For credit side —-
1. Salaries and wages.                        1. salaries received
2. wages.                                    2. commission received
3.Rent received
3.Rent rates and taxes.                       4.Sales
4.Purchases                                    5.Sales return
5.PURCHASES return                                6.Repairs
6.CARRIAGE                                      7.Interest
7.colli and cartage
8.cariage inward.
9.Printing and stationery
10.postage and telegrams
11.Advertisement and publicity
12.Expenses on entertainment
TRY TO solve the questions:
1.What is entry?
2.whatis Golden rules?
3.Identify the following accounts: 3.Mohan 4.Sohan 5.purchases 6.purchases return


  1. Abdul Salam ^T M says:

    Firstly iam sayin thanks for sharing valuable thing with me. Its a basic thing but most of people doesn’t know the rules regarding entry field.

  2. Sayed Golam Ahammad FCMA says:

    Very good

Leave a Reply

Your email address will not be published. Required fields are marked *