Why Debits and Credits AREN'T Backwards

Accounting Basics Lesson 6. In this episode of Accounting Basics for Beginners, we answer the question - why do Debits and Credits on the Bank Statement seem backwards? Debits and Credits are confusing enough without throwing in the complication that they appear backwards in Accounting. When you Google "debits and credits the wrong way round banking", you'll see that there are 39 MILLION results. That's insane!

This episode of Accounting Stuff - Accounting Basics Lesson 6 - is a continuation of our series on Basic Accounting for Beginners and we aim to finally put this issue to bed. In this short video, you will learn:

▪ What phrases such as 'debited to your account' mean.
▪ Why are Debits and Credits backwards in Accounting.
▪ Why Credits and Debits AREN'T backwards.

⏱️TIMESTAMPS
00:00 - Intro
00:38 - Why are Debits and Credits Backwards?

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#accounting #accountingbasics #accountingstuff

[AccountingStuff]

Hope you found this video useful. As always, please let me know if you have any suggestions for future videos?

🔗USEFUL LINKS

⏱TIMESTAMPS
00:00 - Intro
00:38 - Why are Debits and Credits Backwards?

[A.Luckybug]

I’m on a binge with your videos. Love them. I’m learning more from you than my mba program. Thanks so much!

[DixieAcres]

I am in Financial Accounting this semester and it ALL sounds like gibberish. I cannot wrap my head around the whole Debits/Credits things. My husband found your page on Youtube for me and it has helped so much. I still am struggling but your explanations are MUCH better than the material I am given to read and the videos my professor chooses.

[e-man]

2:02 Concerning your banking example: I understand the bank POV, but not the customer POV. Why would debits increase the value of the customer account? Are the banks using incorrect terminology with the common people? Because banks refer to the addition of money to the customer account as "credits".

[annakelly]

Tx, I study accounting now and boy...this bloody small detail was short-circuiting my brain - getting the clarification on the POV from banks perspective cleared it all! Great stuff!

[tahatariq]

First semester of Business Administration ends next week, this whole semester I always got confused b/w debit and credit in my accounting class because of this exact question being stuck on my mind for the entire semester. This video helped a ton!

P.S: Accounting Final tomorrow wish me luck :P

[Root_]

Had lots of confusion between debit and credit because of this banking thing !
Finally you are here ! 🙌
Thanks for your quality, crisp and to the point content !
Cheers ;)

[sanjayks]

James you are doing a great job .. I like ur videos as it's short, precise & of course well explained.I wish you will become a top notch YouTuber in future 👍

[G_Silent]

Noooo, I’m halfway through this playlist, top quality videos!

[ldaniel]

This definitely should have been an earlier video. I was asking this after the debits and credits video he previously did. Thank you for doing this videos!! 👏🏻

[aneeserhosman]

they say better late than never!!!! am an intern currently who signed for IT development where i work but i was pushed to accounting, in the words of my boss, 'we need an all rounder' and today is my final interview, this is such a life-saver. Thanks a lot James

[suryaprabakaran]

The past few days I have had the same confusion as to why in the banks it's another way. Now that I got that clear the learning path is more clear than ever.

[Shooter-]

im studying accounting and have been stuck on this debit and credit thing for ages and no one has given a clearer explanation! the penny has finally dropped lol Thank you xxx

[natashamoquin]

You are such a genius, James. I love how you explain everything ❤️

[Kazzyderps]

For anyone still in confusion, I hope this reminder helps!!
Remember in James second vid he mentioned credits and debits aren't thought of as adding or subtracting but as a source and destination so your asset, the reason it is going up through debit is that your account is the destination so when money is put in it, it goes up while with credit is the source so you may use your assets being cash for example as a source to send it to another account being the other destination. BOOOM WHAAAATT!!! - Had to play this and past videos multiple times to understand this, hope it makes sense! :) If its not entirely right you could just think of this being the asset side of the question XD

[shravaniswami]

Thank you so much James .I've been an learning accounts since a year and seriously I had this doubt from the very beginning and today you just cleared it .please keep making these videos they are super helpful.

[accountingliteracy]

2:09
"It is all about perspective" 👍

[serenacain]

Bruh I knew i wasnt crazy. When i first looked at a bank statement and tried to apply the debit and credit to it and my brain fried. Its really based on perspective.

[DigitalAlligator]

Yes, THIS is exactly the question I want to ask always!

[kamayapendergrass]

I'm trying to switch from banking to accounting and this finally made it make sense