The Basic Content Of Debit And Credit Bookkeeping Is Very Important.

Debit and credit bookkeeping is based on "borrowing" and "borrowing".

The accounts of each account are divided into three columns: debtor, lender and balance.

The borrower is on the left side and the lender is on the right to reflect the increase or decrease of funds.

The "borrowing" and "lending" words used in the debit and credit bookkeeping method have been divorced from the original word meaning (i.e. "borrower" and "loan owner"), and evolved into a pair of simple bookmarks, with two specific meanings.

The meaning of "hunting" and "loan" is exactly the opposite because of the different nature of accounts.

In the asset class (cost class, expense account), "borrowing" means increasing, while "loan" indicates a decrease. In debt and owner's equity (income account), "borrowing" indicates a decrease, while "loan" means a boost.

According to the double entry bookkeeping principle, every business must be paid equal amount and registered in two or more than two interconnected accounts.

At the time of bookkeeping, we must use equal amount for each economic business. On the one hand, there are 1 or more debit borrowers on the one hand. On the other hand, we should remember 1 or several credits of the relevant accounts. The amount of the debtor's loan and the credit account must be equal. This leads to the accounting rules of the debit and credit bookkeeping Law: "borrowing must have loans, and borrowing will be equal".

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Under the economic nature, accounts are generally divided into three categories: assets, liabilities and owners' equity.

However, in order to flexibly deal with accounts, it can also be set up and used, which can be an account of assets and liabilities.

Double accounts (common accounts) should be determined according to their final balance direction. If it is a debit balance, an asset class account, if it is a credit balance, is a liability account.

Because the debit and credit bookkeeping method is in every stroke.

It is necessary to follow the accounting rules of "borrowing and lending, and lending equally".

Therefore, within a certain period of time (such as 1 months), the sum of the total amount of all accounts is necessarily equal; the sum of the end of the balance of all accounts and the final balance of the lender must be equal.

The trial balance formula is:

Total debit balance at the beginning of the year two total initial credits balance

The total amount incurred by the borrower = the total amount of credit in the current period.

Total debit balance at end of term = end of credit balance

Using this balance relationship, we can check whether the accounts are correct or not, so as to improve the quality of accounting.

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In order to rationally choose the distribution base and allocate the indirect cost correctly, the following principles should be followed:

(1) the principle of causation means that the use of resources leads to costs, and there is a causal relationship between them. Therefore, the cost should be shared among the objects according to the number of resources used.

According to this principle, we must determine the amount of resources used by each object, such as consumed materials, working hours, etc., and share indirect costs according to the proportion of resources used.

(2) the principle of benefit refers to "who benefits more and who pays more costs" should share the indirect cost according to the benefit ratio.

According to this principle, managers should determine the beneficiaries of indirect costs, such as the cost of workshop and house maintenance, and the allocation of advertising fees according to the sales volume of various products.

The principle of causation is to look at the cause. The principle of benefiting is to see the consequences, and there are differences between them.

(3) the principle of equity refers to the fair distribution of costs to both parties involved.

When determining the external selling price and the internal pfer price according to the cost, reasonable cost is the basis of reasonable price. Therefore, when calculating the cost, the buyers and sellers should be fair and reasonable.

Fairness is an abstract concept and is not operable.

Therefore, in practice, government norms or authoritative standards become the specific yardstick of fairness.