Negative Items

Negative Items

Account Name | Typical Balance | Grouped as but not considered | But Dr/Cr considered similar to | Dr/Cr Rules for increase |

P/L Account | Debit Dr. | Capital Liabilities | Assets | Debit Dr. |

Purchase Returns | Credit Cr. | Purchase ( Expenses ) | Income | Credit Cr. |

Sales Returns | Debit Dr. | Sales ( Income ) | Expense | Debit Dr. |

Trade Discounts Received | Credit Cr. | Purchase (Expense ) | Income | Credit Cr. |

Trade Discounts Allowed | Debit Dr. | Sales ( Income ) | Expense | Debits Dr. |

Accumulated Depreciation | Credit Cr. | Fixed Assets ( Assets ) | Liabilities | Credit Cr. |

Provision for Bad and Doubtful Debts | Credit Cr. | Accounts Receivable ( Assets ) | Liabilities | Credit Cr. |

Discount Received | Typical Balance | Expense | Income | Credit Cr. |

Discount Allowed | Typical Balance | Income | Expense | Debit Dr |

Discount received and Purchase goes together and Discount Allowed and Sales go together.

DEBIT TO INCREASE

CREDIT TO DECREASE

DEBIT TO INCREASE

CREDIT TO DECREASE

RULES FOR DEBIT AND CREDIT FOR THE BIG 4

Assets

Expenses

CREDIT TO INCREASE

DEBIT TO DECREASE

CREDIT TO INCREASE

DEBIT TO DECREASE

Capital/Liabilities

Income

When there is a case of purchase and VAT is charged at some percent then it means that it is VAT input and we need to add that VAT to the amount of Payable amount i.e. (VAT + Amount Provided) and expense will be the original expense amount + VAT.

When there is a case when we have provided service or sales of our goods to customers and they need to pay us back and TDS applicable is given it means TDS receivable. Which means that customer needs to pay amount given as that includes TDS. For us it means TDS receivable and the remaining amount will be either income or cheques in hand or whatever is mentioned.

Advance paid to Vendor Y for developing certain software for resale. Advance paid to Vendor...