Ready to learn journal entries in accounting? Read on.
Here are some of the journal entries in accounting with debits and credits, including the descriptions:
1. Cash Sale of Goods
- Debit: Cash $1,000
- Credit: Sales Revenue $1,000
Recognizing a $1,000 increase in cash from the sale of merchandise, with a corresponding recognition of $1,000 in sales revenue.
2. Credit Sale of Goods
- Debit: Accounts Receivable $2,000
- Credit: Sales Revenue $2,000
Recording a $2,000 increase in accounts receivable for goods sold on credit, with a simultaneous recognition of $2,000 in sales revenue.
3. Purchase of Inventory on Credit
- Debit: Inventory $3,500
- Credit: Accounts Payable $3,500
Reflecting a $3,500 increase in inventory due to a credit purchase, creating a corresponding liability of $3,500 in accounts payable.
4. Cash Purchase of Equipment
- Debit: Equipment $5,000
- Credit: Cash $5,000
Recording the acquisition of equipment for $5,000 in cash, increasing the equipment asset while decreasing the cash asset.
5. Depreciation Expense
- Debit: Depreciation Expense $800
- Credit: Accumulated Depreciation $800
Recognizing $800 in depreciation expense for the period, accumulating it in the contra-asset account, Accumulated Depreciation.
6. Payment of Salaries
- Debit: Salaries Expense $2,500
- Credit: Cash $2,500
Recording the payment of $2,500 in cash for salaries, reducing the cash asset and recognizing the corresponding expense.
7. Receipt of Interest Income
- Debit: Cash $500
- Credit: Interest Income $500
Recognizing the receipt of $500 in cash as interest income, increasing the cash asset and recognizing interest income.
8. Write-off of Bad Debt ( Direct Method)
- Debit: Bad Debt Expense $1,200
- Credit: Accounts Receivable $1,200
Writing off $1,200 in accounts receivable as a bad debt expense, reducing accounts receivable.
9. Loan Received from Bank
- Debit: Cash $10,000
- Credit: Loan Payable $10,000
Recording the receipt of a $10,000 loan in cash, increasing the cash asset, and creating a liability in the form of a loan payable.
10. Dividend Declaration
- Debit: Retained Earnings $3,000
- Credit: Dividends Payable $3,000
Declaring a $3,000 dividend, reducing retained earnings, and creating a liability in dividends payable.
11. Income Tax Expense
- Debit: Income Tax Expense $1,500
- Credit: Income Tax Payable $1,500
Recognizing $1,500 in income tax expense, creating a corresponding liability in income tax payable.