Use QuickBooks 2006 to Keep Your Debits and Credits Straight
Part of the QuickBooks 2006 For Dummies Cheat Sheet
Assets = Liabilities + Owner's Equity. When using QuickBooks 2006, the natural balance for asset accounts is on the left (debit), the natural balance for liability and owner's equity accounts is on the right (credit). The exceptions are contra accounts and expense accounts that add or deduct from other accounts to form a net amount.
| Account Type | Debits | Credits |
|---|---|---|
| Assets | Increase asset accounts | Decrease asset accounts |
| Liabilities | Decrease liability accounts | Increase liability accounts |
| Owner's equity | Decrease owner's equity accounts | Increase owner's equity accounts |
| Income | Decrease income accounts | Increase income accounts |
| Expenses | Increase expense accounts | Decrease expense accounts |
