Debit

Expenses – Things you spend money on and don’t have anything physical to touch.

For example, cost of goods sold, rent expense, office expense, wages expense, utility expense

Assets – Things you spend money on and you can physical prove you have. Cash, Account, Inventory, Building, Land, Equipment.

Dividends – Money paid to shareholder’s. Each shareholder received money back based on money they invested.

Credit

Liabilities – Things you buy on credit or expenses that are due in a future time period. Accounts payable, notes payable, wages payable, taxes payable

Owner’s Equity – Money that has been invested or that is left after all expenses have been paid. Common stocks, Dividends, Owners Capital, Retails

Revenue – Money that you earn for a product or  a service. Sales Revenue, Service Revenue

 

T-Accounts

Left Side ( DEAD) and Right Side ( CLOR )