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Debit credits

SunnydaySunnyday Posts: 1Registered
in General discussion - Foundation level
Please can someone help keep with debits credits it has completely smashed my head a carnt get my head round them
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Answers

  • fedemennifedemenni Posts: 58AATQB
    DEAD CLIC

    debits: expenses, assets, drawings on one side and credits: capital, liabilities, income, on the other side
    amurray
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  • amurrayamurray Feels At Home Posts: 213Registered, AATQB
    edited December 8
    I learnt DEAD CLIC which was fantastic.... but I was also informed of another one: PEARLS.

    PEA = Purchases, Expenses, Assets – Debits

    RLS = Revenue, Liabilities, Sales – Credits
    AATQB, FIAB.
    *MAAT hopefully to follow soon!
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  • Pian32Pian32 Posts: 90Registered
    I think the other way of thinking about it is: Has the money gone to something or come from something. (from the business perspective)

    Taking DEADCLIC which is what I was taught initially.
    You put money into an expense to pay it.
    You put money into your assets to store it (banks, FAs etc)
    You put money into the owners drawings.

    You take money from a lender (Liabilities)
    You take in income
    You get capital from the owner.

    This also means when you reverse one of those like pay a loan you put money into the loan on the debit side.
    AAT Level 4, MAAT
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