Jackson bought a commercial vehicle for his business, Cleaners Inc., and paid by check. How will he journal this financial transaction?

Vehicle Account (debit) Bank Account (credit)

Vehicle Account (debit) Bank Account (credit).

A vehicle is an asset, and the company gained a vehicle, so an asset increased. When an asset increases, you must debit the account.

The company also paid for the vehicle, and money is also an asset. The company loses money, so an asset is decreased. When an asset decreases, the account must be credited. Always remember that.