Contra account definition including break down of areas in the definition. Analyzing the definition of key term often provides more insight about concepts. The term contra account can be defined as: Account linked with another account and having an opposite normal balance; reported as a subtraction from the other account’s balance. A contra account is named contra because the balance in the contra account is the opposite to the normal balance. Accumulated depreciation is the most common contra account, an asset type of contra account, assets generally having debit balances, accumulated depreciation having a credit balance. Sales discount is an example of a contra account, sales discount being part of the sales or revenue section, a debit balance running contra to the normal credit balances for sales. Returns and allowances is an example of a contra account.
Why Learn Accounting - Financial Accounting / Managerial Accounting
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101 Double Entry Accounting System Explained - Accounting Equation
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101 Cash vs Accrual - Cash Method / Accrual method differenc
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101 Revenue Recognition Principle
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Double Entry Accounting System Explained - Balance Sheet
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101 Income Statement Introduction
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101 Accounting Objectives - Relevance Reliability Comparability
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101 Transaction Rules - Accounting Equation
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101 Transaction Throught Process / Steps - Accounting Equation
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101 Owner Deposits Cash Transaction Accounting Equation
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101 Work Completed for Cash Transaction Accounting Equation
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100.110 Pay Employee with Cash Transaction Accounting Equati
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200 Debits & Credits Normal Balance - Double Entry Accounting Sy
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200 Debits & Credits - One Rule to Rule Them All
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