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Required: Identify the accounts involved in above transactions and state the nature of each account.
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Debit and credit form the backbone of the double-entry system, where every transaction comprises two parts for every debit transaction, there is a corresponding credit of an equal amount. The following are the rules of debit and credit which guide the system of accounts, they are known as the Golden Rules of accountancy: First: Debit what comes in, Credit what goes out. Rule: An increase is recorded on the credit side and a decrease is recorded on the debit side of all liability accounts. Debits are on the left side of the ‘T’ ledger. Debit and credits are accounting entries used to monitor money going out of or coming into the business.
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Rule: An increase is recorded on the debit side and a decrease is recorded on the credit side of all expense accounts. Rule: An increase is recorded on the debit side and a decrease is recorded on the credit side of all asset accounts. debit credit classes, (91)-9658612177,, , kitab mahal, college square, College Square, Cuttack - 753003, revenshaw college,, Cuttack.