Double entry system

複式會計
 Double entry system
• Enter Transaction( 交易 ) twice( 兩
次)
in two accounts
• Debit = Credit

•
• Debit (Dr.)

Credit
(Cr.)
 Accounts 帳戶

• Account Name
• Dr.(Debit) Cr.(Credit)

• Date Details Amount Date Details Amount

 Accounting equation
( 會計等式）

• Asset = Capital + Liabilities

Double entry system
• Assets
+ –
• Liabilities
– +
• Capital
– +
 Double entry system
• Assets

• Buy a motor van $1,000 by cash.

• Motor van (A) +, Cash (A) -

• Motor van Cash

• $1,000 $1,000
 Double entry system
• Assets

• Buy a equipment $2,000 by cheque.

• Equipment (A) +, Bank (A) -

• Equipment Bank
• $2,000 $2,000
 Double entry system
• Liabilities

• Borrowed $3,000 cash from Mr. Wong

.
• Cash (A) +, Mr. Wong (L) +

• Cash(A) Mr.Wong(L)
• $2,000 $2,000
 Double entry system
• Capital

• Owner introduced $1,000 by cash.

• Capital (C) +, Cash (A) +,

• Capital Cash
• $1,000 $1,000
 Accounting equation
• Asset = Capital + Liabilities

• Assets
+ –
• Liabilities
– +
• Capital
– +
 Double entry system
• Stock
• Assets
+ –
Purchases ( 購貨 ) : Buy goods
Sales ( 銷貨 ) : Sell goods
Return inwards ( 銷貨退回 ) : Return goods from Customers
Return outwards ( 購貨退出 ) : Return goods to Suppliers
• Debtor = Customers 顧客
• Sold goods on credit

• Creditor = Supplier 供應商

• 　　　　 Buy goods on credit
 Double entry system
• Assets : Stock (Purchase)

• Buy goods $2,000 by cheque.

• Purchase (A) +, Bank (A) -

• Purchase Bank
$2,000 $2,000
 Double entry system
• Assets : Stock (Sales)

• Sell goods $3,000 by cheque.

• Bank (A) +, Sales (A) -
• Bank Sales

• $2,000 $2,000
 Double entry system
• Assets : Purchase on credit

• Buy goods $1,000 on credit from Mr.A.

• Purchase (A) +, Mr. A (L) + (Creditor)

• Purchase Mr.A (L)

• $2,000 $2,000
 Double entry system
• Assets : Sales on credit

• Sell goods $2,000 on credit to Mr. B.

• Mr.B Debtor (A) +, Sales (A) -
• Mr.B Sales

$2,000 $2,000
 Double entry system
• Assets : Returned goods $1,000 to Mr.A
• Return outwards （購貨退出）
• Mr.A (Creditor)

• Mr.A (L) -, Return outwards (A) -

• Mr.A Return outwards

$1,000 $1,000
 Double entry system
• Assets : Returned goods $2,000 from Mr.B
• Return Inwards （銷貨退回）
• Mr.B (Debtor)

• Mr.B (A) -, Return inwards (A) +

• Return inwards Mr. B

$1,000 $1,000
 Conclusion
• Purchase Sales
• $100 $1,000

• Return inwards Return outwards

• $50 $60
EXERCISES