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Accounting structure
08-06-2009, 08:50 PM
Post: #1
Accounting structure
Hi
I am developing a software which includes the Accounts.
someone guide me about accounting terms and i m very confused regarding 'accounts heads','assets', 'expense' and specially for 'Debit' and 'Credit'. Because each transaction have debit and credit entries in record or database.

I want to know that do anybody can tell me what accouting terms and Accounts Heads are used in Pakistan. I think they are same in all accounting system. Just provide me the basic structue of accounts so I could develope the software.
I know accounting is not so easy but i am trying to overcome it.

Thanks
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08-07-2009, 04:49 PM
Post: #2
 
Basically there are five classes of accounts.
1) Assets
2) Capital
3) Liabilities
4) Revenue
5) Expenses

The debit and credit is called the double entry system. It ensures that errors are minimized. The accounting equation is Assets = Capital + Liabilities.

It means that if you dispose all your assets you will be able to pay off the creditors (liabilities) and take the rest which belongs to you.

The principle of Double entry is

when assets increase they are debited.
when expenses increase they are debited.
when capital increases it is credited
when liabilites increase it is credited
when revenue increases it is credited.

The double entry system follows that for every debit entry there has to be a credit entry which balances it and vice versa.

Hopefully it will give you the basic idea.
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08-08-2009, 02:23 PM
Post: #3
 
Thaks for answering.
It helps me about Debit and Credit transactions
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