Debetpuoli

Debetpuoli is the Finnish term for the debit side in double-entry bookkeeping. It refers to the left side of a T-account and is used to record transactions where value is added to assets or expenses, or subtracted from liabilities, equity, and revenue. The concept is foundational to balancing every financial transaction.

In double-entry accounting, every entry has two equal and opposite sides: a debit (debetpuoli) and a credit. The debetpuoli records increases in assets and expenses, and decreases in liabilities, equity, and revenue. Conversely, the credit side records increases in liabilities, equity, and revenue, and decreases in assets and expenses. The system requires that the total debits equal the total credits for each transaction, helping ensure the accounting equation remains in balance.

Normal balances differ by account type. Asset and expense accounts typically carry a debit balance, meaning increases are posted to the debetpuoli. Liability, equity, and revenue accounts typically carry a credit balance, with increases posted to the kreditpuoli.

Examples:

- Purchasing equipment with cash: Debit Equipment (increase asset) and Credit Cash (decrease asset).

- Earning revenue on credit: Debit Accounts Receivable (increase asset) and Credit Revenue (increase equity via retained earnings).

- Paying a liability: Debit Accounts Payable (decrease liability) and Credit Cash (decrease asset).

- Recording an expense incurred but not yet paid: Debit Expense (increase) and Credit Accounts Payable (increase liability).

In Finnish accounting usage, debetpuoli is often discussed alongside kreditpuoli (credit side). The concept is universal in double-entry systems and underpins accurate financial reporting.