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Principles of Accounts

Bookkeeping & Double Entry

Key Points

  • Double entry: every debit has an equal credit
  • Assets = Liabilities + Capital (accounting equation)
  • Debit: assets ↑, expenses ↑; Credit: liabilities ↑, income ↑
  • Trial Balance: total debits must equal total credits
  • Bank reconciliation: adjusts for unpresented cheques and outstanding lodgements

Practice Questions

2 questions
1

The accounting equation is:

2

Which of the following is a liability in a balance sheet?

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Financial Statements