What are the diffrent types of accounts explain with debit and credit example?
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all accounts can be categorized into 4 major category - Asset Liability Expenses and Income.
When Asset (accounts like Cash, Bank, Inventory, Accounts Receivable, Furniture, Building, Investments etc balance sheet assets side accounts ) & Expenses ( accounts like Salary advertisement, purchase etc Income statement expenses accounts) increases, it will be Debit and decreases, it will be Credit.
On the other hand, when Liability (accounts like Share capital, provisions, Reserves, Accounts Payable etc balance sheet Liability side accounts ) & Income ( accounts like Sales, Interest income etc Income statement Income accounts) increases, it will be Credit and decreases, it will be Debit.
When Asset (accounts like Cash, Bank, Inventory, Accounts Receivable, Furniture, Building, Investments etc balance sheet assets side accounts ) & Expenses ( accounts like Salary advertisement, purchase etc Income statement expenses accounts) increases, it will be Debit and decreases, it will be Credit.
On the other hand, when Liability (accounts like Share capital, provisions, Reserves, Accounts Payable etc balance sheet Liability side accounts ) & Income ( accounts like Sales, Interest income etc Income statement Income accounts) increases, it will be Credit and decreases, it will be Debit.
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