To hate double entry bookkeeping?

[SunFlowerRose]

I’m really hoping you will be able to help me, because this is my last ditch attempt before I throw away 8 months worth of payments on a bookkeeping and accounting course which would cost even more in an early get out fee.

I work full time in finance for a small company, but they use an accounting software so most of it’s all done in the background.

I’m on the first model of the level 2 online course and I just cannot retain the information or make it sink in.

The double entry part and transactions just isn’t making sense and I’m about to lose all hope on it.

If anyone has any resources that helped them such as YouTube videos, links or books then please please do share them.

I’m off to WH Smith later to look at the books they have, in hopes to find one that may help. Along with A3 paper that I plan to right notes on and stick all over the house.

If any bookkeepers would be willing to inbox me and help me with this I’d be super grateful.

I’ve wasted 8 months on this so far and just feel incredibly stupid. And I want this so badly for my current career, it would help me progress so much.

Apologies for putting it in AIBU I was hoping more people would see it and maybe be able to help. Please be kind as I already feel crap enough.

m.youtube.com/watch?v=3kZXjEZqpCg This helped me

In my experience, debits and credits only click for most people through lots of practise. Lots and lots of question practice, writing up manual books for dummy accounts, inventing scenarios, setting up ledgers and T accounts for your personal finances. Download some random accounts, translate them back into a trial balance and then make up a story of what happens next and do all the double entry reflecting it and the new closing TB. Anything you can use to practise them.

I think the mistake you might be making is trying to memorise the concept then repeatedly testing yourself and getting frustrated that memorisation isn't leading to fluency.

Reading your posts, it also sounds like trying to relate it back to the automated system you use at work is tripping you up even more. I don't think you'll be able to really get how debits/credits sit behind that system until you've mastered them separately.

Not because you're stupid, but because when you use a system like that you only see a simplified version of manual ledgers with lots of steps cut out and that's presented to be understandable to people without formal training in accounting - which means it's confusing you rather than supporting your learning.

Debits/credits can be quite counterintuitive, especially if you've got a lifetime of thinking of debits/credits the opposite way around from your own bank statements etc. It's a bit like having to remember to say goodbye as a greeting and hello as a farewell - if you had to make a change like that it would only feel natural through time and practise, not staring at the words trying to memorize the new meanings.

It's not that you're stupid, just that you could use a different approach. This is effectively like attaining fluency in a foreign language. Flashcards might help you learn lots of words, but you need to practise using the language to be able to use those words to confidently string sentences and ideas together in order to communicate.

Stop beating yourself up, do lots of practise of your new language, and you will get there. Beating yourself up (and you have consistently been so unjustifiably harsh to yourself in this thread) will only make you feel more anxious and more shit.

Give yourself the encouragement you deserve and it will boost your confidence. Practise, practise, practise and you will become fluent.

Oh I'm so glad to see this thread as I am doing the same thing and it's driving me a little nuts @SunFlowerRose . I am doing the ACCA FA1 and wonder if I'm just too dumb.

[quote ineedaholidaynow]@PullAFace DH and I (both accountants) often reminisce about manual extended trial balances, we must be a very sad couple![/quote]
No - me too.

Sorry Op - not a lot of help there. But an ETB was the ultimate goal - all written out by hand.

You've had lots of good advice here - anything worth doing takes time to learn until it becomes instinctive. You sound dedicated and willing to put in that time. Once you have passed those exams you can then take that structure and either develop more within the financial field or move on. Best of luck!

I’ll be completely honest - I don’t think it really clicks until you’ve had a lot of practical accounting exposure. I understand the desire to retrain but I tend to think accountancy is one of the disciplines that needs practical experience as much as the exams.

I got my very first ‘proper’ job as an accountant with zero quals because I’d done the on the ground stuff.

When you’re preparing your statements, reconciling your balance sheet accounts etc that’s when it clicks.

Why don’t you post a question you got wrong with your answer? Maybe some of us will see if you have a key principle a bit off and can give you a pointer.

I've made enquiries today to do the AAT L2 course and now I'm wondering if I should.
I started a new job end of last year and a big chunk of my role revolves around using QuickBooks. I'm not a book keeper and I've never used accounting software before.
I'm having a hard enough time trying to get to grips with QB!

I did AS level Accounting and our tutor used to write out questions for us, generally a list of 20-25 events and we had to put them in T accounts, create a trial balance and then the final accounts. I credit him with my most excellent double entry I'm a chartered accountant now and I would be happy to construct something similar if a trainee at work asked me. I agree trying to match it to QB or similar is going to confuse you more, you need to get the hang of it manually and then relate it back to the system.

Basically every transaction has an effect in two places. If you buy something, your expenses are up and your cash is down. It's not possible to do something that only has a single impact.

I agree with those saying stop thinking of bank in terms of your own bank account. It's the opposite way around.

Think of it as any other account, call it money account instead of bank, get the word bank out of your head and you will be fine.

Sorry to be butting in but while there are so many knowledgeable people on here.... what I find difficult to get my head around is the different affects credits and debits have on different accounts. Eg if an expense account is going up you debit it? But if you pay it you credit it?

Is there some way to remember how this works? I know there’s DEAD CLIC or Alien but it’s the increase decrease that I don’t understand.

I totally understand why you started this thread SunFlowerRose it’s just so confusing.

I remember struggling with this too and found it tedious doing it all on paper, when in practice the accounts software does it all for you. But in the long term it does help to know the theory, especially when you have to do journals. Good luck!

I think you’ve done the right thing to go on a face to face course. There will be someone there you can ask about problems, straight away rather than trying to figure things out yourself.

I'm sorry to hear you're struggling with double entry @SunFlowerRose, I must say once it clicks, it really does click.

I started off by joining a graduate scheme at a top 10 City firm, having done a Physics degree. For the first 11 weeks, I didn't have a clue about debits and credits, then I really went back to basics and moved things around on paper, which really helped me visualise what was going on. I've always been a really bad rote learner, and have to understand the concept before I can move on.

In week 12 on the graduate scheme, we had our first professional exams which included the accounting module, which you had to pass, otherwise you got the sack. I was terrified as I didn't come from a monied background like some of the other graduates (one of them is now godfather to royalty), so I had to get it right first time.

Fortunately, it all came together, I qualified with ACA (and later CTA), and 18 years later, I'm working at a very senior level as a Finance Director, with a very decent salary.

You could achieve all this too OP, and stripping the concept back to basics will help you get there, particularly with understanding the key financial statements. Here's what I did at the start:

1. Get an A3 sheet and turn the page landscape

1. Draw a big line down the middle of the page

1. On the left side of the page, write Profit and Loss at the top

1. Next to the Profit and loss header, write DR = bad -ve Cr = good +ve

1. On the right side, write Balance Sheet at the top

1. Next to the header, write DR = good +ve, Cr = bad -ve

1. Under the Profit and Loss header, draw 2 big T accounts, one called Turnover and one called expenditure

1. On every single T accounts, always put Dr on the left, and Cr on the right

1. Under the Balance sheet header, draw 4 big T accounts, call them

• Bank
• Debtors
• Creditors
• Fixed assets

10. Keep it simple for now, and don't worry about any of the other accounts you've heard of that I haven't included above

11. Remember that all Dr must = all Cr. They don't need to all be in the same account, but they must be equal e.g. 3Dr can be equal to 1Cr

12. Get a large number of coins, say 1p and 2p, ready to put them into the left or right column for any example financial transaction you can think of

13. Now you're ready to start your examples:

• if you buy something, you first have to think what does it represent, is it a fixed asset, or an expense? If it's a fixed asset, the Dr will go in a T account on the the Balance sheet side of your page, if it's an expense, the Dr will go in a T account on the Profit and loss side of your page

14. You also have to think about whether you are buying cash or credit, which will determine whether your credit goes to cash or to a creditor to pay later

15. You make the opposite moves for sales, so Cr go either to turnover or to fixed assets if you are selling them (simplified example so not worrying about WIP or COS for now), and whether you get money now as cash, or record as a debtor

16. Try one example by taking 2 2p pieces for your transaction, and physically move them into the appropriate columns in 2 of your T accounts. Then repeat over and over until you get the hang of it.

Moving money around physically really helped me to understand double entry as a concept; I hope it helps you too. Feel free to ask any questions, and good luck!

Years and years ago when I studied bookkeeping (never used that degree), we were taught 4 simple rules for double entry book keeping.

1. All debits have an equal credit, and vice versa
2. Debit what come in, credit what goes out (physical goods accounts)
3. Debit the receiver, credit the giver (individuals accounts)
4. Debit expenses and losses, credit income and gains

If I remember correctly, bank accounts are seen from the bank's perspective. That's why the entries for bank are in reverse.

@DixiePeach

Everyone will have their own method but for me I need to properly understand it - I never used the acronyms.

Debits Are

Increase in cash
Increase in an asset
Decrease in a liability
Increase in an expense

Credits are

Decrease in cash
Increase in a liability
Decrease in assets
Decrease in an expense

Then you should be able to relate it to whichever example depending on the type of transactions and that every debit is balanced by a credit.

So in your example:

A purchase is made which is an EXPENSE so you debit the expense account.

What is the other side? It’s obviously a credit. Are you paying for it immediately? No? You credit your liability account (accounts payable). Yes? You credit the bank as it’s a decrease in cash.

If you paid for it on credit there is now a Credit balance in accounts receivable.

When it comes time to pay, what happens? Your cash decreases so it’s a credit to cash and the debit is the other side.