what is debit and credit balance?

When you see a company's financial statement, it's composed of the following items:
Assets = Liability + Equity
The equation above should always be true. For example, if there is a decrease in assets, there will be one of the followings happen:
1. an increase of the same amount in asset.
2. a decrease of the same amount in liability.
3. a decrease of the same amount in equity.

Therefore, there must be two transactions occurred at the same time to balance the equation. The inventor of accounting then created "debit" and "credit" to do the transactions.

debit transaction always offset credit and vice versa. Here is something you HAVE to remember.
1. ASSET is on the debit side, which means whenever there is an increase in assets, you have to debit asset. On the other hand, when there is a decrease, you will credit asset.
2. Liability and Equity are on the credit side, which means whenever there is an increase in liability or equity you will credit them. On the other hand, when there is a decrease, you will debit them.
(the above is pretty hard to understand for a beginner. Let me know if you have any problems)

So, for your example, the company buy stocks of $200 using $200 cash
ask yourself what category stock belong to? Is it under Asset, Liability or Equity? The answer is asset. Stocks belongs to short term investment which is in asset.

so you will debit (because stock is asset which is on debit side) stocks for 200. and since you use $200 cash to buy the stock, which is a decrease in asset, so you will credit cash for $200.

Let me know if you understand this.

2006-11-02 05:56:27 補充：
debit balance on Asset side means increase in assetscredit balance on Asset side mean decrease in assetsTherefore, the example you provided have two tractions1. decrease in asset ($200 cash) , which is a credit balance2. increase in asset ($200 stocks), which is a debit balance

其實這是ACCOUNT的問題

非常之易

credit的解釋是 --- 拎出
debit的解釋是 --- 接收

在公司角度分折, 他是拎出(credit)$200, 接收(debit)$200的貨(stock).

在對方的角度, 他由營業額(sales)拎出(credit)$200, 接收(debit)$200的cash.

這是一個鏡中影像(mirror image).