Financial Basics

In this topic, we will cover some general accounting conventions and give examples of the automatic journal entries that are created during the sales processes.

Here are some key points to take away:

1. The account balance represents the difference between the total debit transactions and the total credit transactions recorded for that account. 
2. In each journal entry a certain account increases value and another decreases value and the debit side and the credit side balance.
3. Assets, Expenses, and Drawings accounts are generally in debit.
4. Liability, Revenue, and Capital (Equity) accounts are generally in credit.

You can also download the document here for your records.