and the total of all debit and credit entries must balance. The accounting equation, which underlies double-entry accounting, is as follows: The balance sheet follows this format and shows ...

An increase in the value of assets is a debit to the account, and a decrease is a credit. For liability and equity accounts, the reverse is true. Balancing the books relies on double-entry ...

meaning it’s paired with another entry of an equal and opposite amount. In this method, when your company increases money in one account (a credit), it decreases money in another (a debit) — and vice ...