items were bought on credit and that these transactions had increased the input VAT. When we return items to suppliers, the Input VAT, which we claimed for, will be reduced. The asset is reduced and posting is therefore done to the credit side of the VAT input account. General Journal 24 Drawings(inclusive of VAT) 114
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Mar 28, 2017 · In accounting, "debit" and "credit" are opposite forms of the same function, like addition and subtraction. This gets tricky, though, because a debit isn't strictly an increase or a decrease on an account, nor is a credit. It depends on the type of account. Some accounts are increased by debits.

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  • The sum of debit side amounts should equal to the sum of credit side amounts. A journal entry is called "balanced" when the sum of debit side amounts equals to the sum of credit side amounts. T-Account: This form looks like a letter "T", so it is called a T-account.
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The complete accounting equation based on the modern approach is very easy to remember if you focus on Assets, Expenses, Costs, Dividends (highlighted in chart). All those account types increase with debits or left side entries. Conversely, a decrease to any of those accounts is a credit or right side entry.

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When a farmer uses accrual method of accounting in the hatchery business s/he must include in inventory, eggs in the process of incubation. All harvested and purchased farm products held for sale or for feed or seed, such as grain, hay, silage, concentrates, cotton, tobacco, etc., must be included in inventory.

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Account 8630 should always be the credit side of the entry (used by the fund where the transfer will be treated like revenue). Conversely, account 8631 should always be the debit side of the entry (used by the fund where the transfer will be treated like an expense). A debit to 8631 always results in a credit to 8630.

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GnuCash is personal and small-business financial-accounting software, freely licensed under the GNU GPL and available for GNU/Linux, BSD, Solaris, Mac OS X and Microsoft Windows. Designed to be easy to use, yet powerful and flexible, GnuCash allows you to track bank accounts, stocks, income and expenses. As quick and intuitive to use as a ...

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The purchase of livestock feed (cash method of accounting) is both an expense and a cash outflow item. The timing is also the same if a check is written at the time of purchase. However, there are many cash items that are not income and expense items, and vice versa.

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