Increase in a Liability Account is recorded on its credit side. Give reason.
Download our app for free and get started
Liability is a Personal Account and thus the rule applicable is 'Debit the receiver, Credit the giver'. Increase in Liability (suppose creditor) means that he has given goods or some other benefit. Hence Liability is credited.
Download our appand get started for free
Experience the future of education. Simply download our apps or reach out to us for more information. Let's shape the future of learning together!No signup needed.*
Similar Questions
- 1View SolutionGive the full form of SGST.
- 2View SolutionGive an example of a transaction where an asset and owner's capital will increase.
- 3View SolutionWhich transaction decreases one asset and increases another asset?
- 4View SolutionIf the Capital is ₹ 1,00,000 and Outside Liabilities are ₹ 2,50,000, find the Total Assets.
- 5View SolutionIs Capital Account a Personal or Real Account and why?
- 6View SolutionIs 'Cash Memo' a source document or an Accounting Voucher?
- 7View SolutionWhat are Natural Personal Accounts? Give one example.
- 8View SolutionProprietor of the firm has withdrawn goods for his personal use. The accountant has recorded it as sale in the books of accounts. Is he correct in doing so?
- 9View SolutionWhat is a Journal?
- 10View SolutionIn the above case, if the proprietor had invested ₹ 5,000 as additional capital and withdrawn ₹ 2,000, what will be your answer?