Elements

There are five fundamental accounting elements within accounting. These elements are as follows: Assets, Liabilities, Equity, Income and Expenses. The five accounting elements are all affected in either a positive or negative way. Note: A credit transaction does not always dictate a positive value or increase in a transaction. An asset account is called a "debit account" due to the accounts standard increasing attribute on the debit side. The reasoning for an asset account being called a "debit account" is due to the fact that business' usually purchase assets to be used in normal business activities, for example the purchase of a "delivery vehicle". i.e. when an asset has been acquired in a business the transaction will affect the debit side of that asset account illustrated below:Asset
Debits (dr) Credits (cr)
X


Where "X" denotes the effect of a transaction on the asset account. The asset account above has been added to by a value X, i.e. the balance has increased by £X. Each of the mini-tables below show the effect of a monetary value X being added to them. We list each of the 5 types of accounts (defined earlier as the five elements of accounting). An entry that increases the value of an account is not always a debit entry (see the asset account above).

All mini-tables in this section show standard increasing attributes for the five elements of accounting.Liability
Debits (dr) Credits (cr)
X
Income
Debits (dr) Credits (cr)
X
Expenses
Debits (dr) Credits (cr)
X
Equity
Debits (dr) Credits (cr)
X



Summary table of standard increasing and decreasing attributes for the five accounting elements:ACCOUNT TYPE DEBIT CREDIT
Asset + −
Liability − +
Income − +
Expense + −
Equity − +