ACCOUNTING BASICS: Debits and Credits Explained
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- Опубликовано: 19 июн 2024
- 🆓Debits and Credits Free Quiz → accountingstuff.com/blog/debi...
💥Debits and Credits Cheat Sheet → accountingstuff.com/shop
🖊Debits and Credits Practice Questions → accountingstuff.com/practice-...
Shhh, it's a secret! Not really.. In this Accounting tutorial you’ll discover the true meaning of Debits and Credits in Accounting. This episode is a continuation of our series exploring Accounting Basics. To see the whole playlist check out the link below.
The terms ‘Debit and Credit’ are the bread and butter of Double Entry Bookkeeping and reflect the duality or double-sided nature of all financial transactions. It’s crucial to understand this concept when studying Accounting for Beginners because all transactions generate Credit and Debit entries. At the end of the video, I'll show you the secret to Debits and Credits which will make remembering which side of the Accounting Equation they fall on a piece of cake!
🔴Subscribe for more Accounting Tutorials → geni.us/subtothechannel
⏱️TIMESTAMPS
00:00 - Intro
00:39 - Debit and Credit Misconceptions
00:55 - What are Debits and Credits in Accounting?
01:22 - What is Economic Benefit?
01:48 - Which Accounts are Debits or Credits?
02:35 - Is Equity a Debit or a Credit?
02:46 - The Maths behind Debits and Credits
04:09 - How to Remember Debits and Credits
04:33 - Recap
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#accounting #accountingbasics #accountingstuff
In making this video, one of the terms that I found hardest to define is "Economic Benefit"... if you have any alternative definitions to the one I gave I would love to hear it :)
🔗USEFUL LINKS
▪Debits and Credits Free Quiz → accountingstuff.com/blog/debits-credits-quiz
▪Debits and Credits Cheat Sheet → accountingstuff.com/shop/debits-credits-cheat-sheet
▪Debits and Credits Practice Questions → accountingstuff.com/practice-questions/debit-credit-question-pack-1
⏱TIMESTAMPS
00:00 - Intro
00:39 - Debit and Credit Misconceptions
00:55 - What are Debits and Credits in Accounting?
01:22 - What is Economic Benefit?
01:48 - Which Accounts are Debits or Credits?
02:35 - Is Equity a Debit or a Credit?
02:46 - The Maths behind Debits and Credits
04:09 - How to Remember Debits and Credits
04:33 - Recap
Another great vid! I look forward to the rest of the series
Cheers Amy, working on the next one as we speak
It really good. I m eagerly waiting for more videos to cover every topic.
Thanks! I am working on the next one as we speak :)
The definition for "Economic Benefit" was comprehensive and easy. I guess giving an example to fully put it across would suffice. The example I can think of is as follows:
Supposing I am an ice-cream manufacturing firm, I will have to buy assets like machinery and a freezer so that I could manufacture ice-cream. Other than those, I would have to buy ingredients like milk and flavours to make ice-cream, and eventually make money by selling them. Here, the components that I use give an economic benefit to the firm. The machinery and freezer contribute to the firm indirectly, and the ingredients contribute directly.
WOW, I paid 60,000 in grad school getting my MBA and this is the first time I actually hear somebody explain it clearly... My business school professors could never explain it this easily
Cheers Robert, hope it's making sense for you
Very sad really...I can totally relate!
Agreed
I've been told : PEARLS
Debit: Credits:
Purchases Revenue
Expenses Liability
Asset Sales
Thank you James, your films are very good and make much sense :)
this is right but it is repeating the same thing, purchases are classified under assets . On the other hand sales is the same as revenue
I also got told Pearls but I don't think it's getting down to the real crux of what a Debit or Credit is or entails in quite the same way as Dealer. I think if you're capable of understanding Dealer then Pearls is a little bit vague.. or that was my feeling about it. I also got told that DR is money leaving the business and CR is money coming in, but this isn't fully accurate.. so it all feels very contradictory. I kind of think there is no escaping the higher level topics at a basic level as it all feeds into one whole, or the tree as this channel describes it
That is applicable to Inventory under IAS 2
The tree of knowledge of good and evil ..
Credits and then debits
Ye shall surely die of its fruits.😂😂😂
Partake of the fuits if commerce ye shall be surety to its debt
Einstein once said "If you can't explain it simply, you don't understand it well enough."
This guy obviously gets accounting
My professor on the other hand...
Wise words from a wise man!
Agree!
Meanwhile my teacher pretty much just skipped the class and divided us into a group saying there will be a coach and you will learn from them
@@is0latedplays453 Lol.
Bro same 😭
I'm a novice in accounting, and was struggling to understand basic accounting equation. I've jumped on so many videos and references and ultimately lost all sanity. THEN I saw this video. 5.44 mins of listening and I got my sanity back. THE MOST CLEAR AND PRECISE. NO BS. AMAZING!!!!!
Thanks Himanshu, it's great to hear that Debits and Credits are clicking for you. All the best :)
I'm an accounting major and these are some of the best explanations I've found. Good work
Thanks John!
what are you looking at debit/credit videos on your free time? Such an accountant thing to do.
Can you teach me more?
this is really good man!
Sir how i cant contact you?
I've been studying accounting for 2 years and none of my teachers could explain it this clearly. THANK YOU James.
No worries Javeria, hope it's making sense for you
True! He did an amazing job 😍
Javeria Yousuf ikr
CA or ACCA
2 years? this should be taught in the first lesson no?
Been inn accounting for about 3 years and I feel silly because this very basic and simple stuff still gets me confused. This has helped me a lot! I appreciate the work you put into this man!
how is accounting like? Currently in year 8 and everyones telling me to become an accountant
Just casually learning about accounting in the quarantine times (this is 4-month desperation behavior for an unemployed artist), and this concept was the first major stumbling block that made me think I wasn't cut out for it after all. Not only did the video finally get the concept to click for me, but the comment section full of proper accounting students who felt similarly has made me feel better for not getting it 😂 Thanks!!
Hey there! Sorry to hear that you've been having a rough time. Good on you for learning accounting voluntarily! I hope you find it useful
where have you been all my life?! Finally, thanks to you I GET IT.
Haha, no problem... I'm glad that it's clicked for you!
This man proves that accounting is fun! I'm currently learning double-entry bookkeeping with a learning provider that can't explain anything properly, so these videos are a godsend!!!
I've been studying accounting for 4 years and non of my teachers could explain it this clearly. THANK YOU SO MUCH
Thank you for your videos James, bless you. I'm an MBA candidate and I was doing Accounting and financial management last quarter - I got my results today and I passed my exam through using your videos and other material to practice.
Hey, I am new to accounting. Please tell us what other accounting materials helped you. Thanks
Honestly this 6 minute video taught me more than my Professor has in 6 weeks.
Why didn't somebody just say that: "Destination" and "Source". I almost failed accounting in college because I thought credit was "given to me", and debit was "taken from me".
Same with me
I have a unit assessment on Friday and was struggling with doing this via home learning with no one to explain. Watched this twice and think you should be writing our course manuals. Can’t thank you enough, subscribed.
As someone who works in public accounting, these videos have been fantastic to look back to to kick the dust off the brain. Thanks for the videos!
The editing and camera work on this video is amazing! It makes it so fun to watch!
Thanks Matt!!
Matt Eng ikr true all others videos with actual white boards are like so boring😂
Go shop with @Darkfeet7 on telegram he is the best he has been helping me with card for about three months,
I've always had a difficulty understanding accounting, and you've done some good work for me. Keep helping me all the time. Subscribed! 💛
No worries Rumi, I'm happy to help :)
Such a comprehensive manner of explaining something obvious just in about minutes, we appreciate your work here!!!!!
This video helps me LOADS!!! I'm so grateful I stumbled upon this! I can finally feel a little more in my accounting classes! Definitely will be watching more
That's great to hear! All the best with your studies
I wish I found this channel when I was in grade 12!! There are some amazing points and clear definitions. I love the time splits. Keep up the great work
Thanks Georgia, cheers for your support!
As it was suggested earlier by other commentators, James should teach most of professors how to teach Accounting basics. Good job, James! May your hard and creative work only benefits everyone learning this subject and inspires you for best results! Thanks a lot!
I appreciate your visual so much. It never made so much sense to me and I’ve been in accounting a very long time and still struggled with these. You are a gift to all those that are visual learners.
You're awesome! Studying this in uni has been difficult, you organize all the thoughts into a very easy-to-follow explanation that's made it much easier for me. I appreciate it!
I was having difficulty wrapping my head around when an account should be debited or credited and this just solidified my understanding in 5 minutes. Thanks very much!
Great! No worries, glad it's making sense
I literally had to start writing this down as notes in my booklet, well done!!!
Cheers mate! I'm glad that you're finding it helpful!
I did too!
me too
You will never know how much easier you made my life with this video😭❤️ Thanks to you I finally understand why revenues are recorded as credit and expenses are recorded as debits. Earned a subscribe for that!
Taking my first accounting class, it has been a humbling experience. Thank you for sharing this video, it has been most useful!
Glad you found it useful!
Hi James, I'm currently studying for two finance and accounting tests, and I just want to say thanks so much for making high quality videos!
You really know how to teach all this accounting stuff!
No worries, hope they go well!
Already learned more about accounting in this video than I have my entire semester at college. Will be binging your videos to catch up for my final. Thank you!
This guy is amazing--I have never heard as clear of an explanation of this concept as this video details here! He got me through my graduate-level final for my Advanced Accounting class (which consisted of the creation of a direct/indirect cash flows statement). Thanks for your content!!!
after almost 4 months of working as a trainee accountant i FINALLY UNDERSTAND THANK YOU SO MUCH
i have a really important exam on thursday for my qualification and you have singlehandedly made everything just click in my brain and its so silly but i'm tearing up because the workload of my job and studying has been immense, especially since i work nights at a fast food place for extra money so i don't have as much time as the other people in my college class and i am so so happy thank you so much
Posting here in 2022...just wanting to say that your videos cover more and provide a better understanding than more traditional, stuffy courses I have taken in Accounting. I am making a choice to broaden my career horizons by going into Accounting (and before anyone says I am crazy, you need to check out two of his videos that actually gives very good reasons why you SHOULD pick accounting as a career - and why you should not - because hey, it isn't for everyone, but that is besides the point). Anyways, wherever you are now, hope you realized what a positive impact you're making and have made on people and continuing doing this in some capacity.
I study in one of the best universities in Ireland and all it took was this one video for me to finally understand debits and credits....... God bless this man
Great to hear it's clicking for you!
I can not express how helpful this has been. I have been struggling to understand credits and debits since the start of the semester.
I'm studying accounting & finance in my first year, and this video has actually helped me a lot. I've only watched it once so I haven't fully grasped it yet, but this explanation made me look at it this way: The source is x, what do you do with x? If it causes the economic benefit it's the credit. And whatever is on the other side is the debit. Again this probably isn't the best way to look at this. But I had nothing to work with. Just sheer confusion to how to distinguish a credit from a debit.
I really think your video should be played in every accounting course! So many of us seeing this video now really wished we saw it sooner when we were studying!
Glad you enjoyed it! All the best with your studies :)
I can't believe that I didn't watch your videos sooner, James. Made me understand 5 years of mind boggling concepts in 5 minutes. Keep up the good work.
That's great to hear! Glad it's making sense now
I have been studying accounting for years and it was your videos that help me most!
u r a genius in explaining stuff i will recommend this channel 2 my friends
Thanks mate, that would be awesome!
I think Im in love with you. Thank you for putting effort into this. Helps a lot. Production is WOOOOW!!!
No worries Andre, I'm happy to help
Oh my goodness!! You are the best at explaining these concepts. Thank you so much.
someone has FINALLY helped me clear the fog in this whole concept! Thank you!!!
You are such an excellent teacher.
Thanks!
As someone learning accounting for the first time, you really made it concise and simple to understand. You have all the qualities of a brilliant teacher. Thank you and please continue making these videos!
THANK YOU!! This helped me so much. I was just told "You'll just have to memorize it, I don't know what else to tell you". I was struggling with this so much and this video saved me!
Thank you sir! About to get a job in accounting/admin, needed this for refresher. You rock!
You would make an awesome professor in Accounting
I am about to start AS level accounting. Honestly a lot of this seems pretty alien but it's alot clearer than some other stuff I watched. Your videos are great!
Thanks, good luck in with your studies!
How'd your exam go?
I am a student in my senior year majoring in finance. I have taken 4 or 5 accounting classes at this point between the 200-400 level and I have never felt like I have had a good grasp on accounting terminology. This video explains the subject in a such a simple way its mind blowing. Thank you very much for this series.
Great to hear you found it useful! All the best with your studies :)
Love this! Keeping making more.
Thanks! I'm glad you liked it. I am working on the next one as we speak.
Someone posted this guy *@Darkjacob* on *telegram* yesterday and I tried him he is real..thank you very much for this help full information about the credit card with high balance 💯
Great video... keep making more...
I am from India and your videos help me a lot to understand the basics...
Thanks Amal! I'm so glad this helped you out. I am working on more right now, should have another up next week.
Thank you so much for explaining this so beautifully and clearly!! I was having such a hard time wrapping my head around when to debit and when to credit.
I'm so happy I found this channel!
Thank you for making such amazing content
Thanks buddy!
Far out, the destination and source explanation is exceptional. I am in the middle of Accounting 100 here in Sydney, and I already understand how all of this works.. But the tutors and lecturers explained the debit and credit terms with a 'this is just the way it is, just remember it'. Your analogy so much better! Thank you mate!!!
This really helped solidify information I have been studying and the lightbulb came on. THANK YOU!
You teach better than most college's teachers. We need better teachers. Thank you very much for the video
Thanks for your kind words!
i studied international business management and had to accounting courses that i never understood lol. i graduated this june and i am very lost by which directions i should do my masters. i have a gap year and i decided to give accounting a try and i am going to watch all your videos. currently on the 2nd one and man you are making me love accounting. really appreciate your videos, thanks man :)
It sounds like you have some big choices to make. Best of luck with it all!
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Thank you! I’ve learned more from you in the past 30 mins than from reading my accounting book for the past five weeks!! You are awesome 🎉
Great to hear you're finding these useful!
Thank you so much, watching from Kenya. It has really made my attitude towards economics positive simply like that.
you explained this better in 5 minutes than my college class did in weeks lmao
literally saved me from failing my degree. thank you
No worries, hope you smash it
I learned more in that 5 mins than I did in my entire Bookeeping course! Thank you!!
The source and destination explanation really helped a lot! I'm on my second Accounting class and I still couldn't fully grasp the difference until this video. Thanks, James!
Great to hear it's making sense! All the best with your studies :)
Best ever Definition and Explanation of Debit and Credit, I never find a straightforward and accurate definition anywhere on google or in real life. Really appreciate.
🎵debit on the left, credit on the right. Debit left credit right, debit left credit right.🎵did Angelo’s learn that I’m their accounting class
fantastic
Thanks, I'm glad you enjoyed it!
Simple, easy and spot on!! Got so confused earlier.. DEALER will be retained forever!! Take a bow! I just solved the questions I was sitting with for 30 minutes! Thanks to this video
So helpful and DEALER is such a clever way to help memorize the equation. Thank you so much!
DEALER. You’re a champ
Cheers Ershad
Me: Hey Teach are there any easy ways to remember what goes to debit or credit?
Professor: Well, you just gotta memorize it. Sorry.
This guy: DEALER
Dealer is a winner!
during one of my lectures a slide came up with "DEALOR" on it, the teacher said " oh dont worry about that it wont be useful, we'll skip it". Now its way clearer. the source and destination explanation helped a ton
I just have to say... THANK YOU! I finally understand these concepts. 😊🌹
Crystal clear refresher of basic principles. Smashing that like.
Yes ive finally get it screw my classes i love this much more
Woooo! Nice one
Sir please keep making video on accounting subject
Will do! I have just put out another on T Accounts and am working on more as we speak
This is the best explanation of debits and credits I’ve ever heard. And I’ve been perpetually confused by this stuff. Making the complex simple. Brilliant!
Glad to hear it made sense :)
This video helped me last year. Thankful for having this in my recommendation.
i wish i knew wtf was going on
This is straight up about to save my grade
Hope it helps!
Now, this video has really gotten me super clear about the concepts! My professor almost didn't explain this. Thank you for the video!
Great to hear it's making sense :)
The best explanations I've ever found, so helpful. Been struggling with Accounting
Thanks!
Can you go into a little more detail as to why exactly a dividend and an expense is a destination of an economic benefit?
Agreed
Hey William, in my recent video I give a better explanation of this -> ruclips.net/video/5Y3wjH-6gHk/видео.html
Have a watch of that and let me know if it still isn't making sense
In my case, remembering DEALER is so much easier because I am Colombian
then u are pass
this made me lol
Yer my hero
You have the gift of making this stuff interesting. Thank you.
Sir i am from india ......
In a nutshell:
Debit what you get, credit what you give
.
debits=destination
credits=source
Someone posted this guy *@Darkjacob* on *telegram* yesterday and I tried him he is real..thank you very much for this help full information about the credit card with high balance 💯
Omg! I cannot thank you enough!!! I do not have a background in accounting, but I am studying basic financial concepts applied to healthcare at the moment. I have been reading through my accounting textbook and course notes for days now and only getting more and more confused. This has helped me soooo much!
Glad it was helpful!
Quick, fun and straightforward, no fussing around
Thank you so much! I am sharing your videos like crazy with anyone in need
Thank you!
About to go into a lab, pray for me brothers
Best of luck!
this is just a random comment but you look a lot like the football playet Thorgan Hazard lol. But great videos mate
Haha, funnily enough you're not the first to say this. Wish I had his football skills!
WOW... If only they could teach us this way. Amazing work.
Nicely done. Essentially everything 'coming in' (credit) vs everything 'going out' (debit) of the company.
Im still so confused, ugh!
@Darkfeet7 on telegram is a real vendor I can’t believe my eyes that man too real Go on his telegram He sell credit card with high balance💯
@@evelynalice7690 ?
What are you confused about exactly?
Thank you so much for this lesson! Online learning has been okay, but for managerial accounting it's been really hard since I took the first part of accounting a while ago! Don't get the opportunity to ask questions and these videos are saving me lol. DEALER is one I will make sure to remember!
Hey, your videos are super helpful and informative ❤ I bet teachers learn a lot from you too!
mad how you managed to fit in so m8ch information into 5 minutes. my professor took 3 50 minute classes to do the same. big up 💪
Have just watched about 4 of your videos. I am first year college student and am doing accounting for the first time as one of my modules. I am so behind and lost in class, and the lecturer sucks at teaching and explaining things. You have taught me so much more in the past 30min than she has in the past 3 months
Great to hear you're finding these videos useful!