Bite-size learning 3: How do I know when Dr or Cr?

We've learned about the equation [Assets = Capital + Loan] in Bite-size learning 1

As liabilities is the term used for for loan and owing, we rewrite the equation as

Assets = Capital + Liabilities

In accounting the Debit refers to the left hand side of the equation. Therefore Credit refers to the right hand side of equation.

Hence when Assets increase, we debit that assets account. Likewise, if capital and liabilities increase, we Credit it.

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