this bookkeeping stuff is for the birds. Tell me when you debit assets, are you increasing or decreasing assets? When you debit liabilities are you increasing or decreasing liabilities?
Remember the DEAD principle. Debit Expenses, Assets, and Dividends.
In other words, expenses, assets and dividends have a normal DEBIT balance. So when you DEBIT an expense, asset, or dividend, then you are increasing those accounts.
All other accounts are increased when you CREDIT them.
Did that answer your question?
BTW - all you accounting professors out there - I don’t have a trademark on the above. Feel free to use it in your accounting classes.
that helps, thanks. trying to book a leveraged acquisition by myself with a journal entry. dusting off the old L1.
What software are you using? Quickbooks? Excel? SAP?
QB online. seems pretty good but i have my bank account linked with all the movement of different funds and it was hard to get the money to flow to right balances on the B/S.
If you’re interested, PM me and I can send you an Excel spreadsheet that I use to book adjustments and group stuff on the Trial Balance. It’s easy to work with once you figure it out, and you can use it for all sorts of cool tricks, like “normalizing” financial statements, grouping schedules, etc.
Balance sheets used to have a right side and a left side. (These days, they put everything in one column, which inhibits understanding.
Assets were on the left; if you debit an asset account, it increases; if you credit an asset account, it decreases.
Liabilities and equity were on the right; if you credit a liability account or equity account, it increases; if you debit a liability account or equity account, it decreases.
Revenues and expenses make sense: revenues are credits (good things); expenses are debits (bad things). If you credit a revenue account, it increases; if you debit a revenue account, it decreases. If you debit an expense account, it increases; if you credit an expense account, it decreases.
If you think of these accounts versus cash (an asset), they’re pretty easy to remember:
- When you pay cash, you credit cash and debit something else:
- An asset account (e.g., buying inventory), increasing assets
- An expense account (e.g., paying wages), increasing expenses
- A liability account (e.g., paying off a loan), decreasing liabilities
- An equity account (e.g., purchasing treasury stock), decreasing equity
- When you receive cash, you debit cash and credit something else:
- An asset account (e.g., selling old equipment), decreasing assets
- An expense account (e.g., getting a rebate on utilities), decreasing expenses
- A liability account (e.g., issuing bonds), increasing liabilities
- An equity account (e.g., issuing stock), increasing equity
Delete your Charter.
^ better yet, sue for a refund!
i don’t think the intent of the charter is to be really proficient at monkey work. I think I’ll keep it.
^No offense taken. In case you were wondering.
you’re a bsd greenie, everyone knows that.