It refers solely to the amount that shareholders have paid over the par value of the stock. This account is separate from the common stock or preferred stock account, which records the par value of the issued shares. The distinction between these two accounts is not merely for accounting purposes; it also provides insights into […]
As seen from the illustration above, when a transaction is recorded, the debit entry must have a credit entry that corresponds with it while equaling the same amount. Hence, debit entry and credit entry are used to record any and all transactions within a business’s chart of accounts. For accounting purposes, every transaction in business […]
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In this setup, you jot down all debit entries on the left and all credit entries on the right. To find the account balance, subtract the total debits from the total credits. A positive result means a debit balance; a negative result means a credit balance. Create a Free Account and Ask Any Financial Question […]
