The document discusses the accounting equation and T-accounts. It explains that the left side of a T-account is called the debit side and the right side is called the credit side. Assets are increased by debits and decreased by credits, while liabilities are increased by credits and decreased by debits. Stockholders' equity accounts are increased by credits and decreased by debits. Revenues and capital increase equity accounts, while expenses and dividends decrease equity accounts.

1. The accounting
equation must stay in
balance.

2. Left side of the T
Account is called
Debit.
Right side of the T
Account is called
Credit. T
ACCOUNT
DEBIT CREDIT

3. ASSETS = LIABILITIES + STOCK. EQUITY

4. ASSETS ARE
INCREASED WITH A
DEBIT AND
ASSETS
DECREASED WITH A
CREDIT DEBIT CREDIT

5. LIABILITIES ARE
INCREASED WITH A
CREDIT AND
LIABILITIES
DECREASED WITH A
DEBIT
DEBIT CREDIT

6. STOCKHOLDERS’
EQUITY ACCOUNTS
ARE INCREASED WITH STOCKHOLDERS’
CREDITS AND
DECREASED WITH
EQUITY
DEBITS
DEBIT CREDIT
THE TWO ACCOUNTS THAT INCREASE EQUITY ACCOUNTS
ARE REVENUES AND CAPITAL, THE TWO ACCOUNTS THAT
DECREASED EQUITY ARE EXPENSES AND DIVIDENDS