Home For AAT student members AQ 2016 Foundation Certificate in accounting Bookkeeping Transactions
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How to even get started?

Hi All, I've recently started the course but I am struggling to get through the workbook. Any hints or tips on how to make the learning a bit more user friendly would be appreciated. Thanks

Comments

  • AAT_TeamAAT_Team Administrator Posts: 545
    Hi @SLT2017, we highly recommend that you study with an AAT training provider as this with dramatically increase your chances of completing your qualifications.
    SLT2017
  • Zoynal98Zoynal98 MAAT, AATQB Posts: 65
    edited April 2017
    Double entry bookkeeping: Fundamental rule - Every transaction has an effect in at least 2 different account.

    Definitions:

    Asset - Something that you own (i.e. a Car)
    Liability - Something that you owe (i.e. a Loan you take out)
    Income - Money made by providing a service/selling goods
    Expense - Money deducted (you paid for something)

    Example:

    Let's say you bought a Nisan Micra (with glowing race strips on the side) costing £2,000. 2 accounts will be involved in this transaction. A Bank account (Paying by cheque for argument's sake) and an Asset account (A car is an Asset because you own it).

    The double entry would be:

    Asset Account (Car): Debit the Asset Account by £2,000 (paid by via the Bank account (Cheque))

    Bank Account: Credit the Bank by £2,000 relating to the Car purchase (Credit on a bank account means money coming out, Debit on a bank account means money coming in)

    Can you see the double entry? Credit Bank, Debit Asset. Two effects taking place for one transaction.
    -------------------------------------------------------------------------------------------------------------------------------------------------
    Best ways to get your head around double entry:

    PEA | RLS (PEARLS)

    Debit side consists of PEA

    Purchases
    Expenses
    Assets

    Credit side consists of RLS

    Revenue
    Liabilities
    Sales

    or;

    DEAD | CLIC (DEAD CLIC)

    Debit
    Expenses
    Assets
    Drawings


    Credit
    Liabilities
    Income
    Capital

    Hope this helps.
    SLT2017
  • SLT2017SLT2017 Registered Posts: 2
    Thanks, that is actually very helpful. :)
    Zoynal98
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