I finally stumbled upon the final exams timetable for EMBA27. The exams had always seemed like a distant event until I downloaded this document. Staring at my screen in error, I realized that the first course is the Corporate Financial Accountant (CFA). Being the state chairman of the AAA (Association of accounting avoiders), you can imagine the terror in my face when I opened the document. Now, with the pressure mounting and my plans to be part of the prestigious BGS group upon graduation, the accountant in me has awakened. I am presently in a tutorial on CFA where I volunteered to share screen. I am helping the entire class to visualize the lectures on posting their various transactions on T-accounts. This is a major leap for someone who hated anything accounting less than a month ago.
Ever since I started giving myself kudos for the simple improvements, I realized that I just kept getting better. The concept of debit and credit on each of the 5 accounts was stressful considering that debit and credit alerts are common with banks. I have finally understood the concept of the 5 different accounts and where they are posted depending on if there is an increase or a decrease. I personally created a formula to make the impossible seem easy.
- Asset: Increases with a debit, decreases with a credit
- Liabilities: Increases with a credit, decreases with a debit
- Shareholder’s equity: Liabilities: Increases with a credit, decreases with a debit
- Revenue: Liabilities: Increases with a credit, decreases with a debit
- Expense: Increases with a debit, decreases with a credit
This simple rule of thumb has made it easier for me to quickly and almost always accurately post my journal entries into T accounts.