Under the double-entry system every business transaction is recorded in at least two accounts. One account will receive a "debit" entry, meaning the amount will be entered on the left side of that account. Another account will receive a "credit" entry, meaning the amount will be entered on the right side of that account. The initial challenge with double-entry is to know which account should be debited and which account should be credited.
To explain debit and credit in accounting and bookkeeping you must know which account to be debited and which account to be credited.
To debit an account means to enter an amount on the left side of the account. To credit an account means to enter an amount on the right side of an account.
Generally these accounts are debited:
And these accounts are credited
The abbreviation for debit is dr. and the abbreviation for credit is cr. How cash entries are done:
* Whenever cash is received from a party, debit Cash.
* Whenever cash is paid out to a party or expense, credit Cash.
How Debit Credit entries are done in Journal Voucher