Hope you found this video useful. As always, please let me know if you have any suggestions for future videos? 🔗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 00:38 - Why are Debits and Credits Backwards?
Thank you for this video. This has ALWAYS mixed me up. I appreciate this explanation so much. I know from other videos you have made, you have fixed this issue, but the outside noise made it so hard to hear you. All my best!
First semester of Business Administration ends next week, this whole semester I always got confused b/w debit and credit in my accounting class because of this exact question being stuck on my mind for the entire semester. This video helped a ton! P.S: Accounting Final tomorrow wish me luck :P
Tx, I study accounting now and boy...this bloody small detail was short-circuiting my brain - getting the clarification on the POV from banks perspective cleared it all! Great stuff!
James you are doing a great job .. I like ur videos as it's short , precise & of course well explained.I wish you will become a top notch RUclipsr in future 👍
im studying accounting and have been stuck on this debit and credit thing for ages and no one has given a clearer explanation! the penny has finally dropped lol Thank you xxx
I get that your bank account is a liability for the bank but I'm still confused about why debit and credit are the way round they are in general accounting because the words seem to mean the opposite etymology wise
This definitely should have been an earlier video. I was asking this after the debits and credits video he previously did. Thank you for doing this videos!! 👏🏻
Ok, so this is helping me on my way to understand, thank you. But at 2.00mins you said from our (Customer's perspective) debits increase assets. Hmm .... How is that when you also say that our account is an asset but to the bank a liability? (if our account to us is an asset, then surely if the balance decreases (debit) how can it increase assets??? (Just started on an accounting course, well my son, and this got me stuck straight away! How confusing! Of course everyone is likely to think of their own bank statement and debits and credits in our accounts. Wish the books explained it, but at least you have - THANK YOU!!!!! otherwise I'd have got NO further! p.s. I think you are the only one who HAS explained it ??👍) Definitely gave you a thumbs up and sub'd
Every time customer's asset increases, so does the bank's liability to the customer. It's two sets of books being discussed which is why it seems reversed. The customer's cash account is an asset on the customer's books, a liability on the bank's set of books.
Thank you so much James .I've been an learning accounts since a year and seriously I had this doubt from the very beginning and today you just cleared it .please keep making these videos they are super helpful.
That's because from the point of view of the bank, when we deposit cash on our account, the bank is supposed to give us back this cash whenever we need it, so cash is a liability from the bank's point of view
Dude! Your videos have been so helpful for studying for my accounting final! (Also making me nostalgic for my Vancouver days) If you're ever in Victoria I owe you a beer!
Brilliant explanation! I teach Intro to Financial Accounting and my students ask this ALL the time. Instead of writing out my long-winded explanation - I now just give them the link to this video. Thanks :)
So all the institutions couldn't be arsed to use the words correctly when representing transactions to their customers, leading to billions of people thinking the words mean basically the opposite of what they apparently do. Fuck, this is mind-bending.
I really like this outdoors filming location. It's very pretty, but it also mitigates some unpleasant sounds picked up on the mic in most of the previous videos in the playlist, as well as making the color palette a lot more lively rather than having the very bright lights in the eyes. I also like the editing showing physical locations, those are quite nice, like the ScotiaBank shot and a few other shots in the outdoors series so far.
Thank you James! You are amazing! I want to be your friend lol. I went to business school, hated accounting although I always grew up "great at math." It is math but it's a lot more than just that, the logic behind all the moving money didn't click very well. Fast forward a few years and now I work in financial accounting and analysis for a retail company. Watching your videos is like the best refresher but better than college. Your teaching style is great, your persona is so fun and engaging, you make everything so simple and concise. Thank you x 1 million.
I took intro to accounting my freshman year at community college, and for whatever reason, never asked this question yet it continued lingering in my subconscious mind. I’m now entering my senior year of college, and I’m just refreshing my accounting knowledge to prepare me for when I start making more money and again this question continued to slap me in the face. That is until now, THANK YOU SO MUCH I can now sleep in peace lmao!
What is the other account? For the bank. When it credits my personal account (liability account to them) what is the other account they debit? Vault? Or?
James, as ever awesome awesome video but please don't do any more sitting on a railing 200 ft above Vancouver because I spent the whole time worrying you were going to fall off!! 😨
James, I have a question re the customer POV of their bank account. So if I debit (draw money out of) my bank account, how does this increase my asset? Surely if I debit my bank account and therefore reduce its monetary value, it's not worth as much. Shouldn't this decrease my asset, as I now have less of it? Or is it purely because of the DEALER rule, meaning debits increase it? I'm just trying to understand the logic behind it, I need it to make sense in my brain!
To brush up on needed life skills, I'm taking Intro to Accounting through Sophia.org. As another viewer said below, I'm learning more from watching your videos than in my course. This was one of the first questions I had and, you are the only person that answered it. The acronym D.E.A.L.E.R has helped immensely right along with your explanation of DR & CR. Thank you so much for teaching!
Hi.When customer deposit their money into their checking account, from the bank pov, the credit increase, and the debit decrease. The credit here represents liabilities and my question is what does the debit here represents? Thanks!
It's like their is a magic accounting MIRROR; as the bank customer our assets in the bank are an equal and opposite LIabilty to the bank; but were still talking about the same money. But it's reversed like looking in a mirror.
I find your videos very helpful. Thank you, James. Question: In your accounting basic video on Debits and Credits you stated, "Debits represent the flow of economic benefit to a destination and Credits represent the flow of economic benefit from a source." I am trying to make sense with those statements in this video. In regards to Debiting my bank account, I am putting money into my account bank. Is the destination my bank account? In other words, is my account (the destination of this money) the recipient of the economic benefit? If this is the case, then how does this work with the concept of "credits represent the flow of economic benefit from a source"? Does this concept of destination and source even play into this scenario of the POV with account holders and banks? If it does, who (or what) is the source of this economic benefit when the bank owes us our money?
@@AccountingStuff Thank you ever so much for answer my question. Yes, I now think I understand it. This link - your video on DEALER: the Number 1 Hack for Debit and Credits answered my question. The key for me was that I needed to hear that Liabilities, Equity and Revenue are normal credit accounts (and therefore, the source of economic benefits, like cash in your example) and Dividends, Expenses and Assets are represent normal debit accounts, and thus are the destination of where one's cash can go. Brilliant. Thanks ever so much.
@@barryhohulin5634 The account at the bank is not ur property ..its the banks record of what thye owe u ..ie a tecord of theor liability to you... The credit entry indicates it comes from a source ..and is laible to be returned .. Its a credit entry on theor liability side
So, the account holder is only seeing their side of the banks transaction? Which is, the bank crediting a liability account. Am I understanding correctly?
i love your humorous videos and especially those with beautiful Vancouver backdrop, and this one with a plane at the end ;) (commercial aviation enthusiast from n.z. :)
I just started my accounting class a week ago. Could you expand upon what you said at 1:58? For the customer, debits increase assets and credits decrease assets. To me, I can't wrap my head around that concept. Should it be the other way around? To me "debiting" means to take away. So, if I take away money from my checking account, why would it increase? I'm so confused.
Debiting and crediting aren't the same as adding and subtracting. Debits increase the balance of Normal Debit Accounts and decrease the balance of Normal Credit Accounts. Credits do the opposite. I explain in this video: ruclips.net/video/5Y3wjH-6gHk/видео.html
@@eekeey this is the part that hangs people up the most, as our cash experience of positive and negative is our biggest reference prior to accounting... but think of how it works with a liability account (say a credit card). Making a debit (payment) against our credit card certainly now decreases what we owe, not increases it. Here we can see a debit to a credit account is a decrease to the balance. If we charge against it, or rather continue to credit the account, the balance owed increases. If you can remember it more in everyday examples, it's a bit easier to grasp.
@@AccountingStuff Yeah probably, there's a chance we may have seen each other unknowingly. It's a beautiful area once you go beyond the terminal train tracks, great views of downtown as well, especially from your roof. I mean Wow! How long have you been living in the City of Glass for?
Jasper Gillgannon Yeah it sure is! I do a lot of running and am spoiled with having falls Creek so close. We’ve been here about 3 months now. How about you?
2:02 Concerning your banking example: I understand the bank POV, but not the customer POV. Why would debits increase the value of the customer account? Are the banks using incorrect terminology with the common people? Because banks refer to the addition of money to the customer account as "credits".
For anyone still in confusion, I hope this reminder helps!! Remember in James second vid he mentioned credits and debits aren't thought of as adding or subtracting but as a source and destination so your asset, the reason it is going up through debit is that your account is the destination so when money is put in it, it goes up while with credit is the source so you may use your assets being cash for example as a source to send it to another account being the other destination. BOOOM WHAAAATT!!! - Had to play this and past videos multiple times to understand this, hope it makes sense! :) If its not entirely right you could just think of this being the asset side of the question XD
@@mustafaaqil6775 yea me either accounting is backwards just to confuse normal people and make us pay for an accountant. They never give a good reason for the backwards just more confusion. I am not the bank and should not have to think in the perspective of the bank. Makes no sense. May as well just say its backwards bc it is
Had lots of confusion between debit and credit because of this banking thing ! Finally you are here ! 🙌 Thanks for your quality , crisp and to the point content ! Cheers ;)
I am in Financial Accounting this semester and it ALL sounds like gibberish. I cannot wrap my head around the whole Debits/Credits things. My husband found your page on RUclips for me and it has helped so much. I still am struggling but your explanations are MUCH better than the material I am given to read and the videos my professor chooses.
So the golden rules of accounting: 1) Debit what comes in, Credit what goes out. 2) Debit the receiver, Credit the giver. 3) Debit all expenses Credit all income. Do they change hands with the perspective as explained in the video...plz plz plz plz tell..sir
Bruh I knew i wasnt crazy. When i first looked at a bank statement and tried to apply the debit and credit to it and my brain fried. Its really based on perspective.
Yep, one can depend on banks to muddy waters and confuse their customers! Customers are not asking banks for statements of banks' financial position, in which case one could understand why checking account is credit from banks perspective! The customer gets a monthly statement and wants to know their own account balance - the bank should debit the account for any money put in, and credit the account for money taken out - using the customer's perspective. The bank can use it's perspective when it reports to its shareholders!
The past few days I have had the same confusion as to why in the banks it's another way. Now that I got that clear the learning path is more clear than ever.
Hey James thanks for your videos and clarification. Have never entered an industry that is such confusing for a beginner. May I ask you to clear up one question I have. For instance in option trading when paying a premium this is called a debit transaction as I have to pay it out like a sunk cost. Does this banking point of view also apply here like a Brokerage Account point of view or rather its a debit for the counterparty like option writer. I have a big problem as I see always my account cash as an asset and need to think the other way around. Keep up your awesome work. Best from Barcelona
Following this understanding, is it true Is it that the banks want you to spend money and not make money? It seems like LER (of he acronym 'Dealer') is all about them owing you money so they don't like that - It's a liability they have to be cautious about, even if it's your own money you made yourself and put in the bank. And DEA is all about you spending money. They seem to like that because it is less about them owing you any money at all. Could this be why so many people adore getting loans and get a drug high addiction to Credit Cards? (2 things I never had in my life) - Could the banks be subtly inviting people into Debt? Am i crazy - if I am wrong tell me anybody.
Credit cards is ur promisarry note to the bank to create more credited t.consumptiom in the future.. Eveytime u use a credit card....they get ur aggeement to stand surety to new credit that is created that they give to the retailer
Hope you found this video useful. As always, please let me know if you have any suggestions for future videos?
🔗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
00:38 - Why are Debits and Credits Backwards?
Sir plz upload videos related to royalty accounts
Hey buddy, can you do a video on EBITDA?
Can you do a video on reversals?
Please do a series on stocks, EPS, etc!
Thank you for this video. This has ALWAYS mixed me up. I appreciate this explanation so much. I know from other videos you have made, you have fixed this issue, but the outside noise made it so hard to hear you. All my best!
I’m on a binge with your videos. Love them. I’m learning more from you than my mba program. Thanks so much!
Haha, hope you're not sick of me yet! Good luck with your MBA
James, Binging the basics while I'm doing a professional course. Haha
First semester of Business Administration ends next week, this whole semester I always got confused b/w debit and credit in my accounting class because of this exact question being stuck on my mind for the entire semester. This video helped a ton!
P.S: Accounting Final tomorrow wish me luck :P
Good luck!!!
Tx, I study accounting now and boy...this bloody small detail was short-circuiting my brain - getting the clarification on the POV from banks perspective cleared it all! Great stuff!
Glad to hear it's making sense! This confuses a lot of people
Noooo, I’m halfway through this playlist, top quality videos!
Thanks!
James you are doing a great job .. I like ur videos as it's short , precise & of course well explained.I wish you will become a top notch RUclipsr in future 👍
Thanks Sanjay, that is kind of you to say!
Yes, THIS is exactly the question I want to ask always!
Hope you found the answer you were looking for!
im studying accounting and have been stuck on this debit and credit thing for ages and no one has given a clearer explanation! the penny has finally dropped lol Thank you xxx
Great to hear it's clicking for you!
So every time we swipe our DEBIT cards we are DEBITING their liability
Shut up
If i swipe debit card so wont it decrease the bank’s liability? because iam taking out my money and bank is not anymore an incharge for that money??
@@ruqaiyacuttu Debiting a liability does decrease the balance, yes.
I get that your bank account is a liability for the bank but I'm still confused about why debit and credit are the way round they are in general accounting because the words seem to mean the opposite etymology wise
This definitely should have been an earlier video. I was asking this after the debits and credits video he previously did. Thank you for doing this videos!! 👏🏻
You are such a genius, James. I love how you explain everything ❤️
Thanks for your kind words :)
Ok, so this is helping me on my way to understand, thank you. But at 2.00mins you said from our (Customer's perspective) debits increase assets. Hmm .... How is that when you also say that our account is an asset but to the bank a liability? (if our account to us is an asset, then surely if the balance decreases (debit) how can it increase assets???
(Just started on an accounting course, well my son, and this got me stuck straight away! How confusing! Of course everyone is likely to think of their own bank statement and debits and credits in our accounts.
Wish the books explained it, but at least you have - THANK YOU!!!!! otherwise I'd have got NO further!
p.s. I think you are the only one who HAS explained it ??👍) Definitely gave you a thumbs up and sub'd
Every time customer's asset increases, so does the bank's liability to the customer. It's two sets of books being discussed which is why it seems reversed. The customer's cash account is an asset on the customer's books, a liability on the bank's set of books.
Thank you@@yvonnepalmquist8676 for taking the time to explain that
Thank you so much James .I've been an learning accounts since a year and seriously I had this doubt from the very beginning and today you just cleared it .please keep making these videos they are super helpful.
No worries, this used to confuse me too!
I'm trying to switch from banking to accounting and this finally made it make sense
That's because from the point of view of the bank, when we deposit cash on our account, the bank is supposed to give us back this cash whenever we need it, so cash is a liability from the bank's point of view
Dude! Your videos have been so helpful for studying for my accounting final! (Also making me nostalgic for my Vancouver days) If you're ever in Victoria I owe you a beer!
Haha, thanks Liza! I was lucky enough to stay in Victoria for a week last summer. It's a beautiful spot over there. Would love to go back someday.
Brilliant explanation! I teach Intro to Financial Accounting and my students ask this ALL the time. Instead of writing out my long-winded explanation - I now just give them the link to this video. Thanks :)
Hope your students are finding it helpful :)
This is what I have been finding to be so confusing! Thank you for clarifying
No problem :)
Great explanation! You are the only one I have heard answer this
Thanks, hope it makes sense :)
Thanks James ... Now I understand it is the perspective
Yes, that's the key!!
Mind blown. 🤯 Thank you for the clarity. Love your vids. 😎🤟
Thanks Carolyn!
I was so confused about this and you resolbed it in 2 minutes. Thanks
Great to hear it's making sense :)
So all the institutions couldn't be arsed to use the words correctly when representing transactions to their customers, leading to billions of people thinking the words mean basically the opposite of what they apparently do. Fuck, this is mind-bending.
Love the quality of the videos and the thinking process behind them ! It shows your dedication. Thank you for your service, sir !
Thanks! Great to hear you're finding these useful
I really like this outdoors filming location. It's very pretty, but it also mitigates some unpleasant sounds picked up on the mic in most of the previous videos in the playlist, as well as making the color palette a lot more lively rather than having the very bright lights in the eyes. I also like the editing showing physical locations, those are quite nice, like the ScotiaBank shot and a few other shots in the outdoors series so far.
This was super helpful! Thank you!
That's great to hear! All the best :)
Thank you James! You are amazing! I want to be your friend lol. I went to business school, hated accounting although I always grew up "great at math." It is math but it's a lot more than just that, the logic behind all the moving money didn't click very well. Fast forward a few years and now I work in financial accounting and analysis for a retail company. Watching your videos is like the best refresher but better than college. Your teaching style is great, your persona is so fun and engaging, you make everything so simple and concise. Thank you x 1 million.
Thanks for your kind words! Appreciate it :)
This is the biggest thing that screws my brain up, I've never thought about it this way!
You are heaven sent James! And Hector Garcia as well, since I've come to know your channel thru his video. You both are golden! 😮😮😮
I took intro to accounting my freshman year at community college, and for whatever reason, never asked this question yet it continued lingering in my subconscious mind. I’m now entering my senior year of college, and I’m just refreshing my accounting knowledge to prepare me for when I start making more money and again this question continued to slap me in the face. That is until now, THANK YOU SO MUCH I can now sleep in peace lmao!
Haha, no worries I'm glad you can rest easy
Are you a British living in Canada?
I am indeed :)
I figured as much when the first video showed the looney, but I'm not familiar with this city. Is it in Alberta?
I have this exact doubt which isn't letting me proceed in accounting, but I still cannot understand it. sigh
you're hella talented bro gj
You are too kind!
Thanks, man! This explanation cleared my confusion. Bless you. :)
No problem :)
Thankgod, now i finally now what are debits and credits!!
Very clear Bro... Good stuff...... lanjutkan...
What is the other account? For the bank. When it credits my personal account (liability account to them) what is the other account they debit? Vault? Or?
love you~~~~~ Thanks a lot. You are much more helpful than my teacher.
Nice ...great work
Thanks Zaid!
James, as ever awesome awesome video but please don't do any more sitting on a railing 200 ft above Vancouver because I spent the whole time worrying you were going to fall off!! 😨
Haha, never again I promise!
So, Do you mean the bank statement issued to us is in Bank prospective ?
Exactly, it's from their point of view
I won’t skip any ads to support ur video😂 love it 😍
Haha, I don't mind if you skip the ads! Thanks though
James, I have a question re the customer POV of their bank account. So if I debit (draw money out of) my bank account, how does this increase my asset? Surely if I debit my bank account and therefore reduce its monetary value, it's not worth as much. Shouldn't this decrease my asset, as I now have less of it? Or is it purely because of the DEALER rule, meaning debits increase it? I'm just trying to understand the logic behind it, I need it to make sense in my brain!
Hey Jack, from the customer's POV spending money is a Credit to the Bank Account (which decreases Assets).
Thank you James. So hard to twist my head around.
No problem :)
Thanks for making the video trustme It is very very useful for me 😍😘 just waiting for your next video James ❤
No problem! The next one is out Monday 🙂
Very useful mate
Cheers Adham!
My accounting mentor!! Brilliant bro
Thanks mate!
To brush up on needed life skills, I'm taking Intro to Accounting through Sophia.org. As another viewer said below, I'm learning more from watching your videos than in my course. This was one of the first questions I had and, you are the only person that answered it. The acronym D.E.A.L.E.R has helped immensely right along with your explanation of DR & CR. Thank you so much for teaching!
No worries Jennifer, this confused me too! Glad to hear that you're using self isolation time productively
Hi.When customer deposit their money into their checking account, from the bank pov, the credit increase, and the debit decrease. The credit here represents liabilities and my question is what does the debit here represents? Thanks!
Hey Andrew, from the Bank's POV the Debit would represent an increase in cash in their own bank account
Thank you
Thanks a lot
I love you and your content it's a God send!
Thanks Samantha!
Thank you!!
You're welcome :)
Awesome video ...
Thanks Kashmiri!
It's like their is a magic accounting MIRROR; as the bank customer our assets in the bank are an equal and opposite LIabilty to the bank; but were still talking about the same money. But it's reversed like looking in a mirror.
I find your videos very helpful. Thank you, James. Question: In your accounting basic video on Debits and Credits you stated, "Debits represent the flow of economic benefit to a destination and Credits represent the flow of economic benefit from a source." I am trying to make sense with those statements in this video. In regards to Debiting my bank account, I am putting money into my account bank. Is the destination my bank account? In other words, is my account (the destination of this money) the recipient of the economic benefit? If this is the case, then how does this work with the concept of "credits represent the flow of economic benefit from a source"? Does this concept of destination and source even play into this scenario of the POV with account holders and banks? If it does, who (or what) is the source of this economic benefit when the bank owes us our money?
I think I did a better job of explaning it in this video: ruclips.net/video/5Y3wjH-6gHk/видео.html
@@AccountingStuff Thank you ever so much for answer my question. Yes, I now think I understand it. This link - your video on DEALER: the Number 1 Hack for Debit and Credits answered my question. The key for me was that I needed to hear that Liabilities, Equity and Revenue are normal credit accounts (and therefore, the source of economic benefits, like cash in your example) and Dividends, Expenses and Assets are represent normal debit accounts, and thus are the destination of where one's cash can go. Brilliant. Thanks ever so much.
@@barryhohulin5634 Great to hear it's making sense :)
@@barryhohulin5634
The account at the bank is not ur property ..its the banks record of what thye owe u ..ie a tecord of theor liability to you...
The credit entry indicates it comes from a source ..and is laible to be returned ..
Its a credit entry on theor liability side
Utube : banks dont loan money, banks dont take deposits
Very cool and understandable. Thank yoy.
So, the account holder is only seeing their side of the banks transaction? Which is, the bank crediting a liability account. Am I understanding correctly?
Yes exactly
i love your humorous videos and especially those with beautiful Vancouver backdrop, and this one with a plane at the end ;) (commercial aviation enthusiast from n.z. :)
Cheers Nathanael! All the best
Thank you for the it's explaining this was really helpful. Because I am in grad 8 and I was struggling with that in my ems so thanks 👍👍👌🧠💬🗨️👍👌🧠
Grt stuff✌🏻
Thanks!
Dude you're awesome!
"checking account" as for cheque or saving account? Sorry, I am in Australia.
You are freaking awesome.
Haha, thanks!
Brother love your channel, make a video on Bill of Exchange!
Cheers for your request!
Mind blowing !
Mgk does Accounting!
That's a new one!
just as at an exchange office. The buy and sell of a currency from their point of view :D
Exactly :)
Can you make a video explain how to calculate the cash book account
Hey Arwa, thanks for the suggestion!
Yeah you are the absolute bees knees dude. Thank you so much for this.
Cheers Mandolinn!
James was this video shot in Montreal??
It was back in Vancouver :)
I'm still so confused... what do credit & debit even mean
Have you seen the Debit and Credit video? ruclips.net/video/VhwZ9t2b3Zk/видео.html
Keep it up, my friend is visiting your chanel more and more :3
I just started my accounting class a week ago. Could you expand upon what you said at 1:58? For the customer, debits increase assets and credits decrease assets. To me, I can't wrap my head around that concept. Should it be the other way around? To me "debiting" means to take away. So, if I take away money from my checking account, why would it increase? I'm so confused.
Debiting and crediting aren't the same as adding and subtracting. Debits increase the balance of Normal Debit Accounts and decrease the balance of Normal Credit Accounts. Credits do the opposite. I explain in this video: ruclips.net/video/5Y3wjH-6gHk/видео.html
@@AccountingStuff thanks so much! I constantly have to remind myself that debit/credit doesn't mean subtract/add.
@@eekeey No problem. It's best to think of them as a flow of funds from a source to a destination
@@eekeey this is the part that hangs people up the most, as our cash experience of positive and negative is our biggest reference prior to accounting... but think of how it works with a liability account (say a credit card). Making a debit (payment) against our credit card certainly now decreases what we owe, not increases it. Here we can see a debit to a credit account is a decrease to the balance. If we charge against it, or rather continue to credit the account, the balance owed increases. If you can remember it more in everyday examples, it's a bit easier to grasp.
Holy shit
❤✨
OHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH
Hold up, I LITERALLY live right around you
Haha no way! Are you near 'the drive'?
@@AccountingStuff It looks like your right on clark. I'm more east to Commercial though, but same area
@@jaspergillgannon4991 You're spot on, I'm on Clark! What are the chances? I'm around the area all the time so we may well bump into each other
@@AccountingStuff Yeah probably, there's a chance we may have seen each other unknowingly. It's a beautiful area once you go beyond the terminal train tracks, great views of downtown as well, especially from your roof. I mean Wow! How long have you been living in the City of Glass for?
Jasper Gillgannon Yeah it sure is! I do a lot of running and am spoiled with having falls Creek so close. We’ve been here about 3 months now. How about you?
Infact you are too much
Did not help at all.
Nope .. this Biden helped nada
2:02 Concerning your banking example: I understand the bank POV, but not the customer POV. Why would debits increase the value of the customer account? Are the banks using incorrect terminology with the common people? Because banks refer to the addition of money to the customer account as "credits".
For anyone still in confusion, I hope this reminder helps!!
Remember in James second vid he mentioned credits and debits aren't thought of as adding or subtracting but as a source and destination so your asset, the reason it is going up through debit is that your account is the destination so when money is put in it, it goes up while with credit is the source so you may use your assets being cash for example as a source to send it to another account being the other destination. BOOOM WHAAAATT!!! - Had to play this and past videos multiple times to understand this, hope it makes sense! :) If its not entirely right you could just think of this being the asset side of the question XD
I didn't get one word that you said
@@mustafaaqil6775 lol
@@mustafaaqil6775 yea me either accounting is backwards just to confuse normal people and make us pay for an accountant. They never give a good reason for the backwards just more confusion. I am not the bank and should not have to think in the perspective of the bank. Makes no sense. May as well just say its backwards bc it is
So if debits decrease and credit increase what does it mean
ive been studying this for a day now and I still dont understand but i'm looking at all youtube vids, all quora pages and trying to figure it out.
Had lots of confusion between debit and credit because of this banking thing !
Finally you are here ! 🙌
Thanks for your quality , crisp and to the point content !
Cheers ;)
I am in Financial Accounting this semester and it ALL sounds like gibberish. I cannot wrap my head around the whole Debits/Credits things. My husband found your page on RUclips for me and it has helped so much. I still am struggling but your explanations are MUCH better than the material I am given to read and the videos my professor chooses.
I felt the same back in the day. Keep on practicing and I'm sure it'll start to click for you. Best of luck!
So the golden rules of accounting:
1) Debit what comes in, Credit what goes out.
2) Debit the receiver, Credit the giver.
3) Debit all expenses Credit all income.
Do they change hands with the perspective as explained in the video...plz plz plz plz tell..sir
Bruh I knew i wasnt crazy. When i first looked at a bank statement and tried to apply the debit and credit to it and my brain fried. Its really based on perspective.
Yep, one can depend on banks to muddy waters and confuse their customers! Customers are not asking banks for statements of banks' financial position, in which case one could understand why checking account is credit from banks perspective! The customer gets a monthly statement and wants to know their own account balance - the bank should debit the account for any money put in, and credit the account for money taken out - using the customer's perspective. The bank can use it's perspective when it reports to its shareholders!
It certainly is confusing
Thanks James, from the UK
short yet informative way to go!!
Thanks, glad you enjoyed it!
The past few days I have had the same confusion as to why in the banks it's another way. Now that I got that clear the learning path is more clear than ever.
This used to confuse me so much as well. Glad it's clicked for you!
Hey James thanks for your videos and clarification. Have never entered an industry that is such confusing for a beginner. May I ask you to clear up one question I have. For instance in option trading when paying a premium this is called a debit transaction as I have to pay it out like a sunk cost. Does this banking point of view also apply here like a Brokerage Account point of view or rather its a debit for the counterparty like option writer. I have a big problem as I see always my account cash as an asset and need to think the other way around. Keep up your awesome work. Best from Barcelona
Following this understanding, is it true Is it that the banks want you to spend money and not make money? It seems like LER (of he acronym 'Dealer') is all about them owing you money so they don't like that - It's a liability they have to be cautious about, even if it's your own money you made yourself and put in the bank. And DEA is all about you spending money. They seem to like that because it is less about them owing you any money at all.
Could this be why so many people adore getting loans and get a drug high addiction to Credit Cards? (2 things I never had in my life) - Could the banks be subtly inviting people into Debt? Am i crazy - if I am wrong tell me anybody.
Credit cards is ur promisarry note to the bank to create more credited t.consumptiom in the future..
Eveytime u use a credit card....they get ur aggeement to stand surety to new credit that is created that they give to the retailer
this video changed my life
*ITS ALL ABOUT PERSPECTIVE*
It sure is :)
This only answers half my question about this and is something I have already considered. Perhaps it lies in the meaning of the words themselves...
Which part still isn't making sense?
Thanks for the great teachings .
Its helping me deal with the Hm treasury ...
No problem, happy to help :)
Bro, thanks a bunch to say the least. God bless you.
Why is there no more accounting videos :')