Accounting entries and their types. Basic accounting entries
Any company in the course of its activities carries out certain operations. They must be recorded in the accounting. This involves accounts. They participate in reporting.
What are business transactions
A business transaction (CW) is a specific action that changes either the composition of property, or its location, or the sources of its formation. Also, CW can be associated with changes in the formation of the budget, the structure of the company's ownership, equity and borrowed funds, and reserve capital. The fact of a business transaction is the basis for creating an accounting entry. The posting is formed on the basis of documents confirming the operation.
A certain event entails a change in indicators. For example, capital, the amount of property can change. Values can either increase or decrease. Changes in equity cause changes in the balance sheet currency. Consequently, the amount of assets and liabilities also changes.
Examples of business transactions in accounting
Consider examples of operations and their approximate structure:
- Supply. Examples of CW: receipt of raw materials, transfer of funds to the supplier, input of raw materials into production.
- Implementation. Examples of CW: spending on product sales, receipt of revenue, sale of goods.
- Production. Examples of CWs: employee salaries, depreciation of fixed assets, acceptance of a contractor's work, transfer of funds to a contractor.
These are the most common types of business transactions.
Types of business transactions
Consider a table with the classification of business transactions:
Impact on balance | Debit correspondence | Loan correspondence |
---|---|---|
Changing Assets | Active | Active |
Change in liabilities | Passive | Passive |
Increase in asset and liability | Active | Passive |
Downgrading of assets and liabilities | Passive | Active |
These are four types of transactions, which are classified according to the way they affect the balance sheet.
Let us consider in more detail the types of postings (A is an asset, P is a liability, O is a turnover):
- 1 type. Transactions that reduce one item of an asset by increasing another. Examples of type 1: the goods arrived at the warehouse, the money is sent from the account to the cashier. At the same time, the structure of property changes, but the final amount remains the same.
This type has the following formula:
A balance + O on the debit of account 1 - O on the credit of account 2 \u003d P balance. - 2 type. Postings that change liability articles. Type 2 examples: multiplying reserve capital by changing the amount of profit. At the same time, CW causes a change in the structure of sources of funds, but the final assessment remains the same.
This formula belongs to this type:
A balance = P balance + O on the credit of account 1 - O on the debit of account 2. - 3 type. Actions that increase the value of the company's assets and liabilities. Example: operations for the sale of fixed assets, obtaining a loan. Postings change balance currencies.
Formula:
A balance + O on the debit of account 1 \u003d P balance + O on the credit of account 2. - 4 type. Actions that reduce the value of liabilities or the amount of equity by reducing the amount of assets. Example: settlements with suppliers. In the process, both the asset and the liability decrease.
Formula:
A balance - O on the debit of account 1 \u003d P balance - O on the credit of account 2.
Also, operations are classified according to their content:
- Material. Assume the movement of goods and materials.
- Financial. Assumes the movement of funds.
- Estimated. Settlements with contractors.
The type of operation depends on the features of its reflection in accounting.
How to set the operation type
To determine the type of transaction, you need to analyze which accounts were used in the transactions and what changes in the balance currency were made. The following information will help facilitate the determination (A - active, P - passive):
- Active XO. Correspondence: both accounts A. Dt increases, and Kt decreases. The balance doesn't change.
- Passive XO. Correspondence: both accounts P. Dt decreases, Kt - increases. The balance doesn't change.
- Mixed XO on the increase. Correspondence: Dt - A, Kt - P. Dt and Kt increase. The balance is increasing.
- Mixed XO to decrease. Correspondence: Dt - P, Kt - A. The indicators of Dt and Kt are decreasing. The balance will be reduced.
To accurately establish the type of operation, you need to have information about the chart of accounts, the structure of the balance sheet.
FOR YOUR INFORMATION! An asset is the property of a company, and a liability is the source of that property. There are mixed forms in both assets and liabilities.
Accounting entries depending on the type of transaction
Consider postings for the first type of business transactions:
- Direction of raw materials to production: Dt20 KT10.
- Receipt of funds from the buyer: Dt51 KT60.
- Direction of funds to the cashier: DT50 KT51.
Accounting entries for transactions of type 2:
- Withholding personal income tax from wages: Dt70 KT68.
- Increasing the reserve at the expense of profit: Dt84 Kt82.
- Advance payment to the supplier from borrowed money: Dt60 Kt66.
Type 3 transaction postings:
- Receipt of material from the supplier: Dt10 Kt60.
- Payment of salaries: Dt20 Kt70.
- Receipt of borrowed funds: Dt51 Kt66.
Type 4 transaction postings:
- Loan repayment: Dt66 Kt51.
- Payment of salaries: Dt70 Kt51.
- Direction of payment to the supplier: Dt51 Kt60.
These are the accounting entries that are used most often.
The nuances of the formation of postings
Each operation has a dual nature. It affects both assets and liabilities simultaneously. The dependence of Dt and Kt is called the correspondence of accounts. On the left (on the debit) the remains of the company's property are recorded, and on the right (on the credit) - the source of its occurrence. Postings must be recorded at the time of the transaction.
Each posting is documented. Primary documentation confirms the fact of the actual existence of a business transaction. Not only accountants, but also managers and leaders work on its compilation. The primary documentation must contain the following mandatory information:
- Signatures of authorized persons.
- Information about the person responsible for the operation.
- Information about the content of the operation.
- The date the document was completed.
- Type of document.
For ease of entering information, the account is assigned a number. Double entry allows you to confirm the equality of turnover for Dt and Kt for the reporting period. If an inequality has formed, this is evidence of an error. Also double entry makes it easy to set the content of the posting.
Examples
Consider examples of reflecting operations in accounting:
- Priority LLC received funds in the amount of 5 thousand rubles for the transferred goods. In this case, the following wiring will be used: Dt51 Kt62. Transaction amount: 5,000 rubles. The balance sheet currency in this case remains the same, but the assets change. The settlement account is replenished by 5 thousand rubles, the account "Settlements with buyers" is reduced by the same amount.
- At the end of the reporting period, Prioritet LLC made a profit. The manager needs to calculate dividends in the amount of 10 thousand rubles. The wiring will be as follows: Dt84 Kt75. The amount of the operation: 10 thousand rubles. The currency of the balance remains the same. Only the passive changes.
- Raw materials worth 4,000 rubles arrived at the warehouse of Prioritet LLC. The wiring will be as follows: Dt41 Kt60. Amount: 4,000 rubles. In this case, there is a change in the balance sheet currency.
- Prioritet LLC transferred funds in the amount of 5 thousand rubles to the supplier on account of the delivery. The wiring will be as follows: Dt60 Kt51. Amount: 5 thousand rubles.
The transaction reflects the amount of the operation, as well as the primary document on the basis of which it was formed.
Bookkeeping involves the formation of accounting records that reflect the facts of the company's economic activities. In the article we will give the concept of accounting entries, we will talk about the principles of double entry. Here is a list of the most commonly used postings in the economic life of an organization.
Double entry system and chart of accounts
The fundamental accounting method is the double entry method. It lies in the fact that to reflect the state and movement of each accounting object, a separate accounting account is opened:
- the fact of economic life;
- property;
- obligations;
- income;
- expenses.
It consists of two parts: debit and credit. When a transaction is reflected in the debit of one account, it must be simultaneously reflected in the credit of another. It is such a record, reflecting a business transaction and containing an indication of the debit and credit accounts, that is called the accounting entry.
The use of this method should ensure at any time the balance equality between the summed turnover on debit and credit accounts.
Order of the Ministry of Finance No. 94n approved the chart of accounts. It is the basis for developing a chart of accounts used by the company in its work. It is on its basis that standard accounting entries are formed. Consider the most common postings in the company's activities.
Typical accounting entries for property and other assets
Operation | Debit | Credit |
---|---|---|
fixed assets | ||
Acquisition of property, plant and equipment | 08 | 60 |
Purchased equipment requiring installation | 07 | 60 |
Reflected VAT on acquired fixed assets | 19 | 60 |
Transferred equipment for installation | 08 | 07 |
The object of fixed assets was put into operation | 01 | 08 |
Depreciation accrued | 20, 25, 26, 44 | 02 |
Fixed asset sold | 62 | 91 |
The initial cost of the object was written off upon disposal (write-off, sale) | 91 | 01 |
Accrued depreciation written off on disposal | 02 | 91 |
The financial result is reflected upon disposal of an object of fixed assets |
||
profit | 91 | 99 |
lesion | 99 | 91 |
Tangible current assets (stocks, finished products, goods) | ||
Acquired materials for the production of products and other economic activities | 10 | 60 |
Materials written off for the production of products, performance of work, provision of services, wiring | 20 | 10 |
Written off materials for general production costs | 25 | 10 |
Reflected write-off of inventory for management needs | 26 | 10 |
Unnecessary materials are sold on the side | 91 | 10 |
Items purchased for resale | 41 | 60 |
Written off cost of goods sold | 90 | 41 |
Finished products released | 43 | 20 |
Finished products sold to buyers | 90 | 43 |
At the time of delivery of the result of work to the customer, the cost of services rendered, work performed | 90 | 20 |
Settlements with debtors | ||
Products sold to customers, services rendered | 62 | 90 |
The advance payment previously received from the buyer has been offset, posting | 62 | 62 |
Advance payment to the supplier | 60 | 51 |
A loan was issued to a third-party organization or an employee of an organization | 58 | 51 |
Cash flow accounting | ||
Received payment from buyers | 51 | 62 |
Paid for deliveries to suppliers | 60, 76 | 51 |
Received funds in the cashier from the current account | 50 | 51 |
Transferring money from one account to another | 51 | 51 |
Wages paid | 70 | 50, 51 |
68, 69 | 51 | |
Money issued under the report | 71 | 50, 51 |
Bank services paid | 91 | 51 |
Basic accounting entries for accounting for liabilities and equity
Operation | Debit | Credit |
---|---|---|
Capital | ||
The formation of the authorized capital is reflected | 75 | 80 |
As payment for shares in the authorized capital received from the participants: | ||
cash | 51 | 75 |
fixed assets | 08 | 75 |
Increase in authorized capital at the expense of retained earnings | 84 | 80 |
Settlements with creditors | ||
Bank loan received | 51 | 66, 67 |
Reflected accounts payable to suppliers | 08, 10, 25, 26, 41 | 60 |
The previously transferred advance payment to the supplier is credited, posting | 60 | 60 |
Debt paid to suppliers | 60 | 51 |
Advance received from buyer | 62 | 51 |
Wages accrued | 20, 25, 26, 44 | 70 |
Wages paid | 70 | 50, 51 |
Reflected the accrual of insurance premiums | 20, 25, 26, 44 | 69 |
Reflected the accrual of taxes included in the costs | 26, 44, 91 | 68 |
Taxes and contributions to the budget are listed | 68, 69 | 51 |
Reflection of income, expenses and financial results
Operation | Debit | Credit |
---|---|---|
Income and expenses from operating activities | ||
Reported sales revenue | 62 | 90 |
VAT charged on sales amount | 90 | 68 |
Reflected the cost of goods sold, products, services rendered | 90 | 41, 43, 20 |
Reflected write-off of management expenses | 90 | 26 |
Written off business expenses | 90 | 44 |
Other income and expenses | ||
Income received from other sales | 62 | 91 |
Written off the cost of goods sold | 91 | 10 |
Interest accrued on loans and borrowings received | 91 | 66, 67 |
Interest accrued on issued credits and loans | 66, 67 | 91 |
Financial results | ||
Reflected the profit received from the sale | 90 | 99 |
Reflected the loss received from the sale | 99 | 90 |
Positive result from other activities | 91 | 99 |
Negative result from other activities | 99 | 91 |
Accrued income tax | 99 | 68 |
Retained earnings recognized at the end of the year | 99 | 84 |
According to the results of the year, the resulting loss is reflected | 84 | 99 |
Decided to pay dividends | 84 | 75 |
Dividends paid to founders | 75 | 51 |
Bookkeeping is based on fixing all transactions performed using special accounting accounts. A complete list of them is given in the Chart of Accounts, approved by the order of the Ministry of Finance dated October 31, 2000 No. 94n. Accounts can be of three types:
- active, for which posting is carried out by debit turnovers, and spending - by credit;
- passive - receipts are recorded on credit, and expenses are debited;
- active-passive;
- off-balance sheet, which do not participate in postings compiled using the double entry method.
Correspondences are formed by simultaneous debiting and crediting of two accounts. This is necessary in order to display the transition of assets from one form to another. For example, if money is withdrawn from a bank account to the cash desk, there will be less of it on the current account, it is necessary to credit the current account, and there will be more money in the cash desk, so you need to debit the Cashier account.
Accounting entries for beginners with answers: cash transactions
Debit account |
credited account |
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The cashier on the check withdrew funds from the current account of the business entity, the posting of funds at the cash desk is reflected |
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The amount of cash exceeding the cash limit was deposited with the bank for crediting to the current account |
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Funds in foreign currency are cashed out from the bank account and transferred to the cash desk |
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Cash resources received as an advance for future deliveries of goods or services to be provided (if the money was received at the cash desk, then account 50 is used, if a non-cash form of payment is used, then it is appropriate to make correspondence with account 51) |
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An employee returned to the cash desk the money that was overpaid to him along with wages (or vacation pay) |
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The accountable official, on the basis of the advance report, returned to the employer the money not spent during the performance of the official assignment |
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The issuance of wages to personnel through the cash desk or by crediting money to bank cards of individuals is reflected |
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Accountable funds issued (for example, advance money to business travelers) |
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According to the results of the inventory of the cash desk, a shortage was recorded |
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Received credit funds to the current account |
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Loan repaid from bank account |
Accounting entries for beginners with answers: table for fixed assets, goods and materials
Tangible asset accounts are active. Therefore, the receipt of any property is carried out according to the debit of accounting for these objects. Typical correspondence:
Operation characteristics |
To debit account |
On credit account |
Acquisition of an item of property, plant and equipment or intangible assets |
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Commissioning of the fixed asset |
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Calculation of depreciation amounts for fixed assets |
Cost Account |
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Start of using NMA |
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Depreciation deductions for intangible assets accrued |
expense accounts |
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The supplier has shipped the materials |
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Material assets purchased through an accountable person |
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Transfer of materials to production |
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As a result of the inventory reconciliation, a surplus of materials was found |
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Missing materials detected |
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Sold materials and shipped to the buyer |
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Cost of goods sold has been written off |
Accounting entries for beginners - settlements with contractors, budget, staff, founders
All stages of the implementation of transactions with counterparties, business transactions related to the resolution of property issues with personnel or founders are subject to mandatory reflection in accounting. Typical correspondence in these accounting segments is presented in the table:
The essence of the reflected operation |
Account to be debited |
Account that is being credited |
Payroll for hired employees |
Cost account (depending on the department in which the person works) |
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The employee received a loan from the employer |
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The employee repaid the loan taken from the employer |
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A loan issued to an employee is repaid at the expense of wages |
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The shortage discovered during the inventory was attributed to the guilty official |
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Hospital allowance accrued |
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Insurance premiums paid |
Cost Account |
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Income tax withheld from accrued wages |
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The amount of debt of the founders for obligations to the company during the formation of the authorized capital is reflected |
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The founder made a contribution to the authorized capital |
08 (fixed assets), 10 (if the contribution is in the form of materials), 41 (commercial products), 50 or 51 (if a cash contribution is made), 58 (if the contribution is made by transferring securities) |
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Dividend accrual |
70 or 75 (depending on who is the recipient of the funds) |
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Payment of dividends |
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Accepted for VAT deduction |
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Paying an invoice issued by a supplier |
Accounting postings for beginners - deriving financial results
Revenue from the sale of goods is reflected in the entry D50 (or 51) - K90. Expenses are debited by debiting account 90 and crediting cost accounting accounts (20, 26, 21, 23, 28, 25, 29, 44). Accrued VAT is shown by correspondence D90.3 - K68. At the end of the reporting period, it is necessary to close the sub-accounts of account 90 at 90.9. The final step is the withdrawal of profit or loss:
- if a profit is made, then the record of the financial result will look like D90.9 - K99;
- if the result is a loss, then posting D99 - K90.9 is drawn up.
Examples of typical accounting entries for various sections of the Chart of Accounts (Order of the Ministry of Finance dated October 31, 2000 No. 94n) we cited in. In this material, we will additionally present some of the main postings in accounting.
Non-Current Assets, Stocks and Costs: Postings
Here are the main accounting entries for sections I-III of the Chart of Accounts in addition to those discussed earlier.
Posting 20 - 10, materials written off for production, are quite obvious and do not raise any special questions. And how to understand 01 - 01 wiring? Or what does wiring 20 - 20 mean?
Obviously, moving through the same accounting account without changing sub-accounts or analytics does not make sense.
Therefore, posting Debit 20 - Credit 20 implies writing off costs for one type of expense or type of output to another type of cost or product.
So, for example, in accordance with the methodology adopted by the organization for accounting for production costs and on the basis of the Accounting Policy, the costs of workshop No. 2 of the main production are written off in proportion to direct material costs for the costs of the main production of workshops No. 3 and No. 6 without reflecting the output of semi-finished products.
In this case, the posting Dt 20 - Kt 20 will be generated indicating in analytical accounting or on subaccounts to the account the name of the workshop (for example, Debit of account 20 "Main production", subaccount "Workshop No. 3" - Credit of account 20, subaccount "Workshop No. 2").
And the posting Debit of account 01 "Fixed assets" - Credit of account 01 is done, for example, upon disposal of fixed assets, when the accounting value of the object being disposed of is initially debited to the sub-account "Disposal of fixed assets":
Debit of account 01, sub-account "Retirement of fixed assets" - Credit of account 01
And to which of the considered operations can these operations be attributed? Obviously, to the 1st type (A + A-), although as a result of them neither the balance sheet currency nor, in fact, the structure of assets change.
Here are the main accounting entries for accounting for non-current assets, inventories and costs:
Finished products, goods and cash: accounting entries
Let's present some accounting entries for sections IV-V of the Chart of Accounts:
Accounting entry Dt 50 - Kt 71 means that the accountable person contributed to the cash desk the balance of funds previously received for travel or administrative needs. Instead of using account 50, there may also be a posting 51 - 71, when the funds are returned by the accountant to the employer's current account.
By analogy with the considered internal entries on account 20, posting Dt 51 - Kt 51 means that the data of analytical accounting or sub-account have changed for the funds on the organization's current account. This may be when transferring funds from one settlement account of the organization to another of its accounts.
Settlements and capital: accounting records
We give in the table some accounting entries for sections VI-VII of the Chart of Accounts:
Postings 60 - 60 and posting 62 - 62 are made when the analytical data is changed to the specified accounts or sub-accounts. For example, posting Dt 60 - Kt 60 will be done by the debtor upon receipt of a notice from its creditor of the assignment of debt under an assignment agreement. Then the debit of account 60 will indicate the "old" creditor, and the credit - the "new" creditor, to which the right of claim has passed.
Internal postings to accounts 60 and 62 will also be made when offsetting advances issued and received, respectively.
Profit and loss records
The most typical operation for accounting for financial results is revenue recognition.
62 - 90 posting and means that the seller recognized the income from the sale and formed the receivables of buyers for payment for goods, work or services.
91 - 99 posting shows that on other operations, the organization revealed a profit at the end of the month.
Accordingly, Debit 90 - Credit 99 means that the profit was also revealed based on the results of comparing income and expenses from ordinary activities.
Posting Debit 68 - Credit 99 is done when reflecting the conditional income for income tax in accordance with PBU 18/02.
And posting Debit 99 - Credit 84 shows that at the end of the year a profit was formed, which was attributed to accumulated retained earnings.
An organization, taking into account its specifics, can create its own directory of accounting entries based on the Instructions for Using the Chart of Accounts. Indeed, for each synthetic account, it presents the accounts with which this particular account corresponds in debit and credit. Accordingly, the Instruction defines typical accounting entries ().
Postings in accounting are a special way of registering the facts of the financial and economic activities of an enterprise. Recall that any business transaction must be reflected in accounting accordingly. Let's figure out what bookkeeping is, what they are, and how to make them correctly. Actual examples of accounting transactions are shown in a special table.
Let's understand the concepts
Postings in accounting - what is it? This is a way of reflecting business operations in accounting, in which accounting accounts are used in accordance with the current working chart of accounts. Moreover, most transactions are reflected in. Only some postings in accounting can be compiled using a simple method.
In other words, to reflect any committed fact of economic activity, the accountant makes an entry on the debit of one accounting account and the credit of another accounting account in the amount of the transaction, expressed in monetary terms.
When compiling transactions, economic entities use a working chart of accounts, which is developed on the basis of a unified chart of accounts (CAP) and instructions for its use. However, the ENP depends on the type of economic entity.
Thus, non-profit organizations in the development of RPS use the Order of the Ministry of Finance dated October 31, 2000 No. 94n (as amended on November 8, 2010). Public sector institutions apply the Order of the Ministry of Finance No. 157n dated December 1, 2010 (as amended on September 27, 2017). However, for state employees there are additional instructions in accordance with the type of institution.
What are the wiring
All types of accounting correspondence can be divided into two large groups: single (simple) and double (double entry method).
A simple method of compiling accounting entries is that only one accounting account is used to reflect a particular transaction. This method of accounting is called simple. An example of such postings is the reflection of the movement of liabilities and assets on off-balance accounts.
For example, when reflecting the receipt of a fixed asset on the off-balance sheet, the accountant makes an entry: Debit 01 (for NCOs) or Debit 21 - for state employees.
It is worth noting that some economic entities have the right to keep records in a simple way, in simple words - to make single accounting entries. However, non-profit organizations and public sector institutions are not entitled to such a privilege. They are required to maintain the main BU using the double entry method. That is, to make double entries in accounting.
So, double accounting entries are considered to be entries compiled using two accounts at the same time. Thus, one operation in terms of money - a specific amount is immediately reflected in the debit of one account and in the credit of another account. Double accounting entries (examples) - table - are given below.
Drawing up double entries in the accounting of state employees has its own distinctive features. Let's consider them in more detail.
Features of compiling entries in accounting
Let's define the key features of compiling postings for the establishment of the public sector:
- Ways to reflect business transactions in accounting should be fixed in the accounting policy of the organization.
- All entries must be recorded exclusively in rubles, that is, in the currency of the Russian Federation.
- Bookkeeping is subject to registration in some primary documents, and then reflected in accounting registers: special journals or warrants.
- Recordings must be in chronological order.
- If errors and inaccuracies are found in accounting records, corrective entries must be made in accordance with the established procedure.
We will make a reservation right away that the organization itself is obliged to approve the working plan of accounting. That is, list those accounts and sub-accounts that the company will directly use in accounting. When compiling accounting entries, the table may contain all accounts for instructions, or only specific values.
How to compose: key principles
Officials have provided the basic principles of compilation, which must be observed without fail. Let's figure out what requirements for compiling records are enshrined at the legislative level:
- All accounts are divided into active, passive and active-passive accounts.
- At the end of the period, only a debit balance can be registered on active BLs. For example, this is a midrange to reflect fixed assets. In simple words, the residual value of fixed assets cannot have a negative (credit) balance.
- Passive accounts have only a credit balance. The debit balance at the reporting date indicates an error in accounting. Example: Accounts to reflect liabilities 0 302 00 000 can only have a loan balance.
- Active-passive MFs can have both credit and debit balances. For example, accounting accounts to reflect taxes and insurance premiums 0 303 00 000 (the balance can be on a loan - a debt, or on a debit - an overpayment).
Based on the accounting data, the final financial report is formed - the balance sheet. Indicators of passive accounts form a liability of the balance, active, respectively, an asset. But active-passive midrange can be reflected both in the asset and in the liability of the balance sheet. For example, overpayment of taxes (debit balance on account 0 303 00 000) forms an asset, and debt on the same account forms a liability.
Examples of Accounting Entries
So, let's define examples of postings in accounting for a budgetary organization. Typical records will be considered in the context of the main areas of accounting.
Calculate payroll and income tax
Operation |
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Wages accrued |
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Sick leave accrued at the expense of the FSS |
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Accrued personal income tax |
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Writ of execution, union dues deducted from earnings |
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Salary transferred to employees' cards |
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Benefits paid out of the FSS |
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Insurance premiums paid |
0 303 02 730 - VNiM 0 303 06 730 - NS and PZ 0 303 07 730 - FFOMS 0 303 10 730 - OPS |
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Taxes and dues paid |
Accounting for fixed assets
Inventory accounting
Next, we suggest that you familiarize yourself with the key features of compiling accounting records for public sector institutions and NGOs. In the articles you will find relevant examples of accounting correspondence, as well as the norms of the current legislation and the basic rules for organizing and maintaining records in areas (fixed assets, wages, settlements, etc.).
Compiling correspondence: a cheat sheet for state employees
By fixed assets |
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Settlements with suppliers and contractors |