“ACC101 – Double-Entry Bookkeeping Notes with Journal Entries, Examples & Practice Problems”

📘 Double-Entry Bookkeeping – Notes with Journal Entries & Examples



1. Introduction to Double-Entry Bookkeeping

Double-entry bookkeeping is the system of recording transactions where every transaction
affects at least two accounts:

 Debit (Dr) → What the business receives.

 Credit (Cr) → What the business gives.

👉 Golden Rule: “For every debit, there is an equal and opposite credit.”



2. Rules of Debit and Credit

Account Type Debit (Dr) Increases Credit (Cr) Increases

Assets ✅ Increase ❌ Decrease

Liabilities ❌ Decrease ✅ Increase

Equity/Capital ❌ Decrease ✅ Increase

Revenue/Income ❌ Decrease ✅ Increase

Expenses ✅ Increase ❌ Decrease



3. Format of a Journal Entry

Date Particulars Debit (Dr) Credit (Cr)

yyyy-mm-dd Account to be debited xxx

To Account to be credited xxx

(Brief explanation)

, 4. Examples with Journal Entries

Example 1: Owner invests cash into business ($10,000)

 Cash (Asset) increases → Debit

 Capital (Equity) increases → Credit



Date Particulars Debit (Dr) Credit (Cr)

2025-01-01 Cash A/c 10,000

To Capital A/c 10,000

(Owner invested cash)



Example 2: Business purchases furniture for cash ($2,000)

 Furniture (Asset) increases → Debit

 Cash (Asset) decreases → Credit



Date Particulars Debit (Dr) Credit (Cr)

2025-01-02 Furniture A/c 2,000

To Cash A/c 2,000

(Furniture purchased)