- In all transaction actions, We'll have two additional transactions for our double-entry bookkeeping.
- Following the Rule of double-entry bookkeeping;
Debits
- Increase asset, expense and loss accounts.
Credits
Increase liability, equity, revenue and gain accounts.
Therefore, We'll add or substract amount value from the account's initial balance. Notice that all accounts start at zero. For instance, in Sales, we'll credit Sales account and debit Inventory account. When we purchase Inventory, We'll credit Inventory account and debit Sales account.