T-Account

A T-account is a visual tool used in accounting to track the increases and decreases of a specific financial item, such as cash or inventory. It is shaped like the letter "T," with the account name at the top. The left side (debit) records increases or additions, while the right side (credit) records decreases or reductions. This simple layout helps accountants organize and verify financial transactions, ensuring accuracy in recording how each account changes over time. It's a fundamental method for understanding and managing a company's financial activities.