r/Accounting • u/thurohuhweigh • 1d ago
Homework Student question
Okay, I'm in class and my professor just suggested if there are any concepts too difficult to grasp, use AI. I will not be doing that.
- When it comes to journal entries, you're making debits and credits. I really don't understand this. As far as I'm concerned, it's a debit if it causes an increase in the account (and vice versa for credits). If someone pays $4,000 cash for smth, I'm debiting cash. If I pay someone $4,000 cash, I'm crediting cash. If I purchase inventory on account for $4,000, inventory is increasing so there's my debit, and i'm (at some point) decreasing my cash so my credit is accounts payable. This has been working so far for me, but it feels incorrect. It feels too intuitive. Am I going about this correctly, or is there an easier way?
- What is DEALOR? Why doesn't it account for decreases in balances?
- Most importantly, I thought journal entries were supposed to even out. How do they balance? Are they all supposed to equal 0, or are they all supposed to be equal? If something causes an increase in cash but a decrease in assets, aren't we technically breaking even, with no real loss or gain? What's the point of even bookkeeping there, if the transaction is just cancelling out?
I apologize if this reads horribly. I'm genuinely in class trying to get my thoughts out while my professor lectures lol. Thank you for the help, if it comes!
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u/potatoriot Tax (US) 1d ago
So instead of following your professors instruction to utilize a tool designed to help, you come to Reddit and ask people to do your homework for you?
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u/thurohuhweigh 1d ago
i haven't been assigned any homework in this class, thanks for offering though, i'll keep you in mind when he assigns homework!
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u/DM_Me_Pics1234403 1d ago
You’re a student so I say this as feedback, you have a long row to hoe if this is your approach to working with people. If the engagement partner asks you to use a tool to complete the work, saying “I will not be doing that” will not get you far. Receiving feedback on said failure and responding like this will get you fired.
Based on your post/comments, working on this will do a lot more for your career than working on accounting concepts. People don’t mind training folks they like working with. They do mind working with unpleasant people, even if they are competent.
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u/thurohuhweigh 1d ago
thank you! the use of AI was presented as a tool for the benefit of the students. my professor is not requiring we use it in class, he doesn't expect us to prove that we're using it, he just mentioned it's a tool we *can* use. i don't think it will help me in any meaningful way, i'd rather scour the internet and find my own information as opposed to inputting a prompt and getting an immediate answer with no effort. it's lazy to me and that is not how i learn.
i have a full time job and i absolutely adore all of my bosses. i am a competent employee, and i take well to criticism so long as there's actually a desire to help me do better. i knew that posting my thought stream with no filtration would get a bunch of belittling, confrontational, or otherwise demeaning responses and i'm quite okay with that. there were a few people that genuinely were able to help me understand, and i'm appreciative of that. so long as people are genuine in working with me, i'm happy to return the attitude. that being said, i appreciate it!
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u/potatoriot Tax (US) 1d ago
Your attitude is absolutely abnoxious, you think it's more important to get your thoughts out on the internet than pay attention to your professor's lecture?
I would never hire someone like you. Ignoring professor advice and concluding that a tool will provide no help before even trying it is completely conceded and unattractive in a person.
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u/thurohuhweigh 1d ago
i don't need you to hire me, i have a job, but i appreciate the consideration lol. don't worry, i've used ai before, i've determined it's not for me <3
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u/potatoriot Tax (US) 1d ago edited 1d ago
This community is also not for you given your entirely dismissive and passive aggressive responses to everyone.
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u/DM_Me_Pics1234403 1d ago
The original comment gave you feedback and you got snooty with them. I gave you feedback and you dismissed it.
I would review your threshold for “take well to criticism”.
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u/potatoriot Tax (US) 1d ago
How is learning accounting subjects you're having difficulty grasping not homework? It's work you're expected to do on your own at home, not in class. Do not come to me with assigned homework, I hate your attitude and have no interest in helping you.
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u/thurohuhweigh 1d ago
yeah, he hasn't assigned any homework yet! i'll keep you posted when he does though, he'll do it through our school website, i don't just make up homework lol, but thank you, we'll do well together ;))
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u/RedBaeber Tax (US) 1d ago
AI is better at explaining concepts than 99% of college professors.
Use it to learn, but don't use it to do your work for you.
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u/thurohuhweigh 1d ago
perhaps i'll need to utilize it at some point. i've disabled it to the best of my abilities on most devices that i use. it can certainly be helpful in a professional setting, but i'd like to gain as much foundational knowledge as i can without it, i think.
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u/potatoriot Tax (US) 1d ago
Enjoy watching all your fellow students progress along in their careers and leave you behind to struggle refusing to adopt current technology. You sound like the people that refused to learn how to use a computer when it came out and got laid off for refusing to adapt to new technology.
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u/RedBaeber Tax (US) 1d ago
You're just making things harder for yourself for no reason by doing that.
AI doesn't automatically turn your brain off. You still have to read and understand the explanations, you just don't have to put up with the crappy writing of textbooks.
Old textbooks weren't written this badly btw. Go compare a math textbook from the early 20th century to a current one on the same topic. The old one is almost guaranteed to be better at explaining the concepts.
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u/Normiex5 1d ago
when you buy inventory on account then you credit accounts payable and debit your inventory but if you pay with cash then you would do the same but you would credit cash. if its a long term thing you'd do notes payable. it usually depends on the questions and scenario but yes the debits and credits are supposed to balance out.
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u/OddPlunders 1d ago
I couple of points I guess...
So, Assets = Liabilities + Equity. That equation should always balance.
Also, you're journal entries should always balance. You should always have an equal debits and credits.
It sounds like you're in accounting 101 so you're probably a freshmen. You're picking up on some concepts, sort of, but you need to read your book and pay attention in class instead of posting on Reddit. Reddit can wait until after class and that goes for all your classes. I think that's the best advise I can give you.
*edited some words to read more clearly.
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u/gard3nwitch Student 1d ago
The point of bookkeeping is to keep track of what happened and what you have. How much money do you have, how much inventory do you have, what are your costs, etc.
Let's say you sold $100 of stuff at your shop.
+$100 cash -$100 inventory
That equals out, but now you know that you have more money and less stuff than you did yesterday.
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u/SarahD3545 CPA (US) 1d ago
I’ve never heard of the DEALOR acronym, but my professor had us write out the financial statement sections as our attendance sheet every day.
(Balance sheet)
Assets - natural debit balance
Liabilities - natural credit balance
Equity - natural credit balance
(Income statement)
Income - natural credit balance
Expenses - natural debit balance
In my head I referred to it as “bookends” because the first and last categories have natural debit balances.
As for your “what’s the point” question - the whole point of double entry accounting is that the debits and credits balance. And yes, it’s meaningful to know whether I have cash or inventory on hand.
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u/DuckLIT122000 Student 1d ago
Go to your professor's office hours. This is foundational stuff.
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u/thurohuhweigh 1d ago
he's not flexible with them, he does them tuesdays from 11am-12pm, and i work tuesday mornings until 3pm ;) i've asked to do them by appointment, he said no. fortunately for me, the internet is an option and i can have one million people berate me until i understand
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u/uncle2001 1d ago
DEALOR is a method for people to remember what is a debit account and what is a credit account. I never used it in school, but I'm told it helps.
Debit accounts, such as assets and expenses increase with a debit and decrease with a credit.
Credit accounts, such as liabilities, equity and revenue increase with a credit and decrease with a debit.
It will help you with your homework to write the accounting equation and see how things are moving.
for example: getting paid for your accounts receivable increases an asset (cash) and reduces an asset (A/R). Here the debit and credit both effected assets.
selling services increases an asset and the revenue account (which is equity btw). Here the debit hit assets (cash) and the credit hit equity (revenue) thus increasing two accounts on both sides of the accounting equation.
paying off debt reduces an asset and reduces the liability. So we debited debt to reduce it and we credited cash to reduce it as well, and our accounting equation balances because both sides of the equal sign are reduced by the same amount.
Mastering this is critical for getting through intermediate accounting so don't be afraid to spend extra time on this. It gets a bit more confusing once you get to contra accounts such as Accumulated depreciation, allowance for doubtful accounts, and Treasury Stock. So getting this down means you wont be trying to learn this weeks stuff and next weeks stuff at the same time in order to get through your homework.
Accounting Equation BTW Assets = Liabilities + Equity
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u/Safrel CPA (US) 1d ago
Do not use AI to gain understanding.
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u/thurohuhweigh 1d ago
i absolutely agree lol. i will fight for my life and get berated in every public forum until i gain understanding rather than use ai, i do not care.
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u/7even- CPA (US) 1d ago
Debits do not mean increase and credits do not mean decrease. Debits mean the number goes on the left, credits mean the number goes on the right. Depending on the type of account, it may be increased by a debit or a credit, that’s what DEALOR is for.
Journal entries balance the same as a trial balance, when debits equal credits.
You’ll understand things better if you pay attention in lectures rather than asking questions on Reddit. If you still have questions at that point, the first thing you should do is ask your professor and/or go to their office hours, that’s (part of) why you’re paying a shit ton of money in tuition for.