T-account Entries

Q: Tracy paid $200 for a widget. Please show me how this would be inputted in the T-account.

Comments for T-account Entries

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Posting Expense in T-account
by: LOH

Since paying for a widget is an expense incurred, increase in expense is recorded on the left side i.e Debit, and we’ll use Bank to represent this as the contra-account in the Expense ledger.

And since every account has two sides, the complementing part will be decrease in Asset (since there will be a reduction in money possessed by the person. It could be through cash or online transfer) so decrease in asset is recorded on the right side i.e Credit, and we’ll use Expense (widget) as the contra-account to represent this on the Bank ledger.
Hi
by: Anonymous

Spending for widget mean Expenses , so 120$ is in Debit side of Expenses.

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