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Chapter 4 – Debit and Credit Theory | Accounting 1, 7 th Edition3 Debit and Credit Theory When viewed in T-account form, all accounts have a left and a right side.
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Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition1
Chapter 4Debit and Credit Theory
4
Chapter 4 – Debit and Credit Theory | Accounting 1, 7th Edition2
Debit and Credit Theory
Today’s lesson focuses on classifying various transactions using debit and credit theory.
For more detailed instructions, refer to Section 4.2 of the Accounting 1 textbook.
Debit ?
Credit ?
Chapter 4 – Debit and Credit Theory | Accounting 1, 7th Edition3
Debit and Credit Theory
When viewed in T-account form, all accounts have a left and a right side.
Chapter 4 – Debit and Credit Theory | Accounting 1, 7th Edition4
Debit and Credit Theory
The word Credit is associated with the right side.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition5
Debit and Credit Theory
Assets, Liabilities, and Owner’s Equity accounts have their own debit and credit rules.
Chapter 4 – Debit and Credit Theory | Accounting 1, 7th Edition6
Debit and Credit Theory
Remember, assets behave opposite from liabilities and owner’s equity because they are on different sides of the balance sheet.
Chapter 4 – Debit and Credit Theory | Accounting 1, 7th Edition7
Debit and Credit Theory
Transaction 1: The company purchases $200 worth of supplies from Packham Products, to be paid for later.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition8
Debit and Credit Theory
Transaction 1: The company purchases $200 worth of supplies from Packham Products, to be paid for later.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition9
Debit and Credit Theory
Transaction 2: The company pays $500 to Dini Bros. in partialpayment of the amount owed to them.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition10
Debit and Credit Theory
Transaction 2: The company pays $500 to Dini Bros. in partialpayment of the amount owed to them.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition11
Debit and Credit Theory
Transaction 3: The company receives $200 cash from R. Van Loonin partial payment of her debt.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition12
Debit and Credit Theory
Transaction 3; The company receives $200 cash from R. Van Loonin partial payment of her debt.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition13
Debit and Credit Theory
Transaction 4: A delivery service is provided for a customer ata price of $400. The customer pays cash at the time the service iscompleted.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition14
Debit and Credit Theory
Transaction 4: A delivery service is provided for a customer ata price of $400. The customer pays cash at the time the service iscompleted.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition15
Debit and Credit Theory
Transaction 5: A used truck costing $8000 is purchased from DiniBros. A cash down payment of $2500 is made at the time of the purchase and the balance is to be paid at a later date.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition16
Debit and Credit Theory
Transaction 5: A used truck costing $8000 is purchased from DiniBros. A cash down payment of $2500 is made at the time of the purchase and the balance is to be paid at a later date.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition17
Debit and Credit Theory
Transaction 6: A delivery service is completed for R. Van Loon at a price of $350. Van Loon does not pay for the service at the time it is provided, but agrees to pay within 30 days.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition18
Debit and Credit Theory
Transaction 6: A delivery service is completed for R. Van Loon at a price of $350. Van Loon does not pay for the service at the time it is provided, but agrees to pay within 30 days.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition19
Debit and Credit Theory
Transaction 7: One of the lifting machines (part of Equipment)breaks down. The company spends $650 cash to have the machinerepaired.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition20
Debit and Credit Theory
Transaction 7: One of the lifting machines (part of Equipment)breaks down. The company spends $650 cash to have the machinerepaired.
Chapter 4 – Debit and Credit Theory l Accounting 1, 7th Edition21
Debit and Credit Theory
Summary of all transactions.
Practice. Practice. Practice.
On page 102,
• Review Questions (1-12)
• Exercises (1-4)
Presentation Title runs here l 00/00/0022
