The direct cost of selling your goods and providing services, for example: purchase costs and freight charges. Revenue from the sale of goods and services.
Common equity accounts are current year earnings, retained earnings, and shareholders’ equity. The business’s net worth, that is, its assets minus its liabilities. Money owed by you that is due in more than one year, for example: a business loan. Money owed by you that is due in less than a year. Other assets you own, such as loans made to others and goodwill. These may include short-term deposits.Īssets that have a long life, for example: buildings, cars, and computers. Money in the bank, for example: in a checking or savings account.Īssets that, if required, can be turned into cash within a year. For example: when you record a transaction to pay $100 for your utility bill from your checking account, there would be $100 credit (decrease) against your checking account and $100 debit (increase) to the expense account you use to track utility payments.ĪccountEdge uses a standard account number format (X-XXXX) for your accounts list. Since AccountEdge is a double-entry accounting system, every transaction entered will have an equal amount in the form of a debit and a credit. Accounts that normally carry a credit balance are the liability, equity, and income accounts. Accounts that normally carry a debit balance are asset and expense accounts.Ī credit amount increases the balance of accounts with a credit balance and decreases the balance of accounts with a debit balance. CreditĪ debit amount increases the balance of accounts with a debit balance and decreases the balance of accounts with a credit balance. Let’s explore the subject of accounts in AccountEdge to get a better understanding of what you will be setting up.
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