What does dead CLIC mean?

What does dead CLIC mean?

Double entry Accounting is a system whereby two bookkeeping entries are required for each transaction. The entries are made via debits & credits which can be remembered via the acronym DEAD CLIC which stands for Debits: expenses, assets, drawings and Credits: Liabilities, Income, Capital.

What does CLIC stand for accounting?

PEARLS (purchases, expenses, assets on debit side then revenue, liabilities, sales on the credit side) and DEAD CLIC (debits, expenses, assets, drawings on one side and credits, capital, liabilities, income, on the other side) are a few which springs to mind but here’s another, one which may be helpful if you haven’t …

What is the accounting equation?

The accounting equation is the proposition that a company’s assets must be equal to the sum of its liabilities and equity. Phrased differently, it means that the equity of a company is equal to its assets minus its liabilities.

What is credit debit?

A debit is an accounting entry that either increases an asset or expense account, or decreases a liability or equity account. A credit is an accounting entry that either increases a liability or equity account, or decreases an asset or expense account. It is positioned to the right in an accounting entry.

Is Plca a debit or credit?

As per the Modern approach of accounting – Credit the increase in liability, Debit the decrease in liability. PLCA is a liability, therefore it is generally credited. It will be credited if its balance increases & debited if balance decreases. Also, it will generally show a credit balance.

Is purchases a debit or credit?

Purchases are an expense which would go on the debit side of the trial balance. ‘Purchases returns’ will reduce the expense so go on the credit side.

Why is purchase ledger control a credit?

When a purchase or sale is on credit, you need to use a control account. A control account will help identify what is outstanding – what is owed to the business (asset) and what the business owes (liability) – controls accounts also allow you to record both sides of an accounting transaction (debit and credit).

What are the 3 accounting equations?

There are three elements of the Accounting Equation; Assets, Liabilities and Owners Equity. The Assets of a company are things that are owned by a business; such as cash, property and equipment that is used to run the business. Liabilities are the financial obligations of a company.

Does Dr mean I owe money?

The ‘DR’ relates to debit and is the amount you owe.

Is purchase return a debit or credit?

The account Purchases Returns is a general ledger account that will have a credit balance (or no balance). Its credit balance will offset the debit balance in the Purchases account.