Credit and debit accounting rules are the systematic guidelines that govern all financial transactions made within an organization. Credit means an entry on the right side of a ledger account that adds value, while debit means an entry on the left side of a ledger account that subtracts value. By following these credit and debit rules, businesses can track their finances more accurately, manage their cash flow better, and ensure compliance with legal regulations. The main rules of credit and debit accounting dictate that transaction totals must always be equal, assets must always equal liabilities plus owner’s equity, and all entries must be recorded in the correct accounts. In other words, understanding credit and debit accounting rules is essential for small business owners who want to keep their books balanced and accurate!