UNRAVEL the Mystery of Debits and Credits - Accounting Basics - Part 1

Do you want to know the trick to remebering how debits and credits work in accounting? Debits and credits are the foundation of bookkeeping and accounting and in this video we make it easy to learn with our simple explanation of debits vs credits.

00:00 UNRAVEL the Mystery of Debits and Credits - Accounting Basics - Part 1
00:07 Debits and Credits Made Easy
01:31 Recording Debits and Credits
03:17 How Debits and Credits Work
04:13 Rules of Debits and Credits
04:25 Debits and Credits Examples
04:33 Sale Transaction Debits and Credits
07:37 Expense Transaction Debits and Credits
09:28 Debits and Credits in Accounting

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This video is the first of a series of four video tutorials on accounting basics for small business owners:

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Please note that Bullseyemoney is not a financial or tax adviser. Our videos are here to inform you and the information provided does not constitute financial, taxation, legal, business or other professional advice and should not be relied upon as such. Bullseyemoney is not liable or responsible for any financial, tax, legal, business or other decisions you make. If you are looking for advice, you should seek a suitable and qualified adviser.

[soniabrissett]

This is fabulous, thank you for explaining in simple terms

[springrain]

Hello and thank you for this video! At around 6.52 you say that they money received INTO the (actual) bank (which is normally classed as a credit in everyone's understanding) should be entered into the ledger as a debit ??? I realise there must be two opposite entries and because we already have the Credit entry in the Income ledger we must have a debit somewhere else, but it still doesn't make sense it is debit in the bank ledger. ??
Do I think of it that:- the money came in the Bank ledger and we IN THEORY took it out to put it into the Income ledger - is that why?
(This is something that has really cause a blockage in our going forward in our studies of accounting (I'm working with my son for his IGCSE)

[nuzamiamohammedseidibrahim]

thank you sir. how do we record bank transfer and all the expenses?

[annafilou]

But… when you download a bank statement, it shows all of the transactions where money goes out of the account as "debit" transactions.

[mikem]

Nobody but nobody on YouTube has explained this well; this just gloss over it. I do like the fact that you employed minority cartoon characters. Well done.

[marknunes]

I think there are 2 transactions. It gets confusing if you combine 2 transactions into one. For instance they pay you for the logo and you give them the logo that's one transaction. You debit a logo from your business and you are credited with their payment. Then you debit the money from your business and credit it to the bank account. Now that everything is done electronically we've forgotten that extra step and that's why it's confusing and there is no way to keep it from being confusing now that it all seems to go directly from the customer to the bank. It's just no one changed the wording because that would be too confusing. It would throw everyone off. So to make sense you have to think of it the old way as two transactions.

[jerzywitek]

Why We call Cash Account????
If my customer pay me cash I have real money in my pocket.
If money go to my account they are no Cash anymore .Just " Money in the Bank".
We should call - Cash in the Bank if I own Box in the Bank and deposited real money- Cash.

[juhandremillen]

Can you explain more clearly to me, please. Because from the consumers side debits are when you pay for something without debt, and credit is when you pay for something on debt.