Double Entry

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
Hello everyone!

I started college on 11 September doing the diploma pathway!

I know there are alot of questions about the double entry but can somebody please simply outline what the general rules are for this? and also what are the control accounts? My mind is overloaded and im lost within all the information at the mo? Also everyone in my class seems to have got it but me??? :oops:

Please help!!!

Thank you!!!!!!!!

Comments

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Double Entry

    Hello Tracy,

    First off, these forums are here to ask for help so never feel afraid or too proud to ask...

    Please read my explantion of double entry using the following link;

    http://www.aat.org.uk/forums/posts/list/13166.page

    The principle of double entry is that for every debit entry or amount there will be an equal credit entry or amount elsewhere and vice versa.

    The theory of control accounts can be explained as follows;

    Imagine you had a separate physical paper book for every customer you sold goods on credit to - there might be dozens or even hundreds of them. These are called the subsidiary or memorandum account books.
    Then at the end of the month, say you want to know your total outstanding credit sale balances. To go through each memo book, total all the amounts then add all the figures together would probably take hours. A control account is a "master account book", keeping tally of all the other accumulated amounts in one volume, thus - in theory - reducing the time taken to extract all the figures. It doesn't record all the individual sales and invoice numbers - that's the job of the memo books - just the total accumulative balances of all the other books together in one simple figure.

    All businesses will have a sales and purchases control account, however larger ones may have additional ones such as stock or VAT control accounts...

    Regards,

    Robert
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Double Entry

    Thank you very very much Robert!

    I will have a good look at that site and read your reply in more detail and also read my college books so I know I am confident with the double entry at home as at the minute im very busy at work!!! How did you learn it so quickly???

    I work for a small company and we use sage. Sage does all this double entry stuff without me even knowing!!!

    I have dedicated this weekend to double entry!!! woo hoo!!! :(

    Thank you once again!!!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Double Entry

    I'm at Technician level Tracy, but trust me when I say that it didn't come to me too quickly when I was doing Foundation!!! :?

    You can see the subsidiary accounts in Sage by clicking on each customers individual account balance. All these outstanding amounts added together will give you the control account figure.

    This control account figure will then be visible in your company's Balance Sheet and will be called Debtors or Trade Receivables or similar...

    Regards,

    Robert
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Double Entry

    Thank you Robert!

    If you can apply it to something at work then it tends to make more sense!

    Thank you for all you help!
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Double Entry

    One day double entry will click. It takes some longer than others but it does click! PEARLS and DEADCLIC helped me get the idea of it at first but now it's like a second nature and I don't even need to think about it. In a few months time you'll be saying the same thing; I promise!

    Good luck

    Gem
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Double Entry

    Hi All,

    Quite a newby to this and I may be being a bit previous but my exam is in June and Im afraid that if i havent got the hang of it now i never will.

    I have read everything everyone has helpfully put on here about Double Entry and Im still lost with it all. I did a practice paper yesterday and the 1st part of it was ok until it come to entering things in the main ledger.....They were all on the wrong sides etc. AAARRGGHH!!

    I am going to die UNQUALIFIED!! :evil:
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Double Entry

    Hi

    Just think

    IN = (Debits) OUT = (Credit)

    Expenses are debits. I buy stationery I think the expense goes IN to the debit side. I pay for the Stationery - money goes OUT of my Bank Account.

    Also
    DIALL CILLA
    Debits Increase Assets and Lessen Liabilities.
    Credits Increase Liabilities and Lessen Assets.

    So I buy a car which increased my assets - this goes into the Debit side. I get a Loan out to pay for this - this is a liability so this goes into the Credit Side.

    Hope this helps a bit.
    Yas
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Double Entry

    Hiya,

    Yes it does thankyou...

    Hopefully I will get there eventually! :P
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:Double Entry

    Hi All

    I also feel the same as you Bambilicious! :oops:

    Except I have my exam on 05 December!!!!!!! :roll:

    Its so hard to get your head around it all! I have had a word with my tutor and she has been very helpfull and gone through it all for me (again!!!) so as I said in my previous message this weekend im going to read through everything I have and try to get a way of remembering it all so it comes second nature to me!!

    Good Luck with your studies and your exam!!!!

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