Recording of  Debits and Credits for Expense Accounts

Expense accounts are items on an income statement that cannot be tied to the sale of an individual product. Of all the accounts in your chart of accounts, your list of expense accounts will likely be the longest. Expense accounts run the gamut from advertising expenses to payroll taxes to office supplies. It's imperative that you learn how to record correct journal entries for them http://www.firststepfirst.co.in because you'll have so many.  

Debits are increases in expense accounts. Credits are decreases in expense accounts. Increases in expenses are recorded as debits on the right side of the ledger. Decreases in expenses are recorded as credits and are recorded on the left side of the ledger.

Here's an example of a business transaction involving an expense account and the resulting journal transaction. Let's say a company needs to stock up on office supplies. It purchases $750 in office supplies using cash. Here's the resulting journal entry:

Office Supplies $750

Cash $750

"Office supplies" is an expense account off the income statement, so you would debit it for $750. Cash is an asset account. You credit an asset account -- in this case cash -- when you use it to purchase something.

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