What am I doing wrong?

nadia48

hi,
Desperately need help.
I'm on chapter 3 of bookkeeping transactions and I feel like I'm missing something. I understood that all incoming money is a debit and everything out going is a credit. All these actions have the oppsite affect on another account.
I did some practice questions at the end of the chapter and got them all wrong as the answers are the opposite of what I've written.what am I missing?
I'm using the osborne books and the questions at the end of the chapter. I'm very confused and would appreciate any help given of you have used the osborne books.
Thanks all

Pian32

I think you need to go over the chapter again as there's defineitly a misunderstanding on what makes a debit and credit:

DEADCLIC

Debit
Expenses
Assets
Drawings

Credit
Liabilities
Income
Capital

The way I think of is you are a third body acting as a middle man. On any transaction think about where have you taken the money from (CREDIT) and where have you put it (DEBIT)

Eg.
A sale of £150 cash

Credit income (sales)
Debit asset (cash)

Purchases for £200 not paid immediately

Debit Expense (Purchases)
Credit Liability (Purchase ledger)

If you do the opposite for instance pay off a liability from the bank.

Debit Liability
Credit Bank

In each of these cases the money has come from the credit (even if only a promise to pay) and been given to the debit

I hope this helps.