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Debit & Credit Review
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Index
Title Page
Index
Introduction
Revenue
Expense
Drawing
Debit and Credit In
The Expended
Ledger
Expanded Ledger
Trial Balance
Credit
Introduction
During this PowerPoint presentation,
Dr. Bob is going to present you “Debit
and Credit in The Expanded Ledger”.
Also he is going to show you some fun
ways of learning accounting in a fast
way. So please be seated and pay
attention to the screen for the next half
hour….Thank You!! 
Revenue
In the expend ledger,
three special accounts are
created and one of them
is “Revenue”. Revenue is
an increase in equity
resulting from the sale of
goods or services in the
usual course of business.
But you have to
remember that Revenue is
a credit entry on the
expend ledger.
Ex. A medical clinic
performed a service for
$50.
Cash
$50
Fees Revenue
$50
Expense
The second special
account created in a
expend ledger is
“Expense.” An expense
represents a decrease in
equity resulting form the
costs of producing the
revenue. Also you have to
remember expense is a
debit account.
Ex. A company pays
10,000 for advertising fee.
Cash
$10,000
Advertising
Expense
$10,000
Drawing
The third special account
created in the expend
ledger is “Drawing”.
Drawing represents a
decrease in equity
resulting from the
withdrawals of funds by
the owner. Also, you have
to remember that drawing
is a debit entry
Ex. The owner of the
company takes $3000 out
of his company used it
his own purpose.
Cash
$3000
Drawing
$3000
Debit and Credit In The
Expended Ledger
The ledger is now expanded to include revenues, expenses, and
drawing. Thus, the rules of debit and credit must now include
these new items. The complete rules of debit and credit are as
follows:
TYPE OF
ACCOUNT
TO INCREASE
TO DECREASE
Capital
Credit
Debit
Revenue
Credit
Debit
Expense
Debit
Credit
Drawing
Debit
Credit
Expanded Ledger Trial
Balance
This is an
example of trial
balance with
the new
expanded
ledger system.
As you can see
owner’s equity
has been
separated into
Capital,
revenue,
expense and
drawings.
Account
E. Boa
Trial Balance
--date--
Debit
Bank
2439
A/R—H. Geroux
1420
A/R—J. Magill
757
A/R—E. Parsons
1395
Supplies
2316
Office Equipment
7550
Automobile
16800
Credit
A/P—OK Supply
4400
A/P—Sooter Store
1200
Bank Loan
940
E. Boa, Capital
21878
E. Boa, Drawings
3950
Fees Revenue
23660
Advertising Expense
1321
Car Expense
2615
Rent Expense
1300
Sundry Expense
385
Wages Expense
9830
52078
52078
Credit
PowerPoint Designed By: David Lin
Information Provided By: Barton Du, Andy Lin
Please remember to go to the R drive to pick up
this PowerPoint presentation, and study it
within seven days, or bad things will happen
to you!
Thank You again for watching this
presentation!! 