FAQs

DEALER is an easy way to remember which accounts are usually debited or credited.

• D: Dividends
• E: Expenses
• A: Assets (these accounts increase with Debits)
• L: Liabilities
• E: Equity
• R: Revenue (these accounts increase with Credits)

I like this framework because it helps demystify why debits sometimes feel like “adding” and other times like “subtracting.”

In cash accounting, you record income and expenses when the money actually moves. In accrual accounting, you record them when they’re earned or incurred – even if payment happens later.

Many small businesses start with cash accounting because it’s simpler, but accruals give you a clearer picture of how your business is performing over time.