Debit

A debit is the left-hand entry of a voucher. Think of it as where the value went: into an asset you now hold, or into an expense you have used up. Debiting Cash or Bank means money came in; debiting Office Rent means money was spent on rent; debiting Creditors means you paid down what you owed. On an income or liability account a debit reduces the balance, which is why a refund to a customer debits Sale of Goods. Reading the Dr column of the General Ledger therefore tells you what the business received or consumed. Debits are never good or bad on their own; the pair tells the story.

Debit raises Assets and Expenses; debit lowers Liabilities, Equity and Income.

1. 01Go to Invoicing > Journal Entry > New and set the posting date to the rent date.
2. 02In the first row pick Office Rent and type Rs 25,000 in the Debit column.
3. 03In the second row pick Bank Account (rename me) and type Rs 25,000 in the Credit column.
4. 04Check the Difference field reads zero, then Submit.
5. 05Open Financial Reports > General Ledger, filter Account = Office Rent; the Rs 25,000 sits in the Debit column.

Read the Dr column of the General Ledger to see what came in or was spent.

Paying Shrawan rent debits Office Rent Rs 25,000 (an expense goes up).