Basic Accounting Concepts

Basic Accounting Concepts 2 – Debits and Credits

A tutorial to help you understand the bookkeeping/accounting concepts of Debits and Credits

Most people don’t find the math of Accounting as difficult as understanding the concepts of accounting, and for many there is no more difficult concept to grasp than that of Debits and Credits. Now the concept of Debits and Credits is actually more than 500 years old, being used extensively by the Venetian merchants of Italy in the 15th century Renaissance period. The concepts were first documented in Latin in the 1400’s and were later translated into English in the 16th century. Is it any wonder then, with the passage 500 years, that we may have become a little confused about the original meaning and concepts, particularly with the English language adopting new legal and everyday meanings for these age old words. So it may be beneficial then, as we try to understand the concept of Debits and Credits, to go back to where it all begun … but first some background.


Basic accounting concepts – for bookkeeping students


This training session is targeted at students who have a desire to learn more about bookkeeping. While specifically developed for students other people interested in understanding more fully the accounting concepts, may also find this training session beneficial.

Prior to commencing this training session, it is recommended that you first complete theBasic Accounting Concepts 1 – Definitions.
This training session assumes that you know a little about bookkeeping but that you realise to progress in your work application or your learning, you need to understand more fully the concept of Debits and Credits. So, this session seeks to deliver training on the concept of Debits and Credits, from the student bookkeeper’s point of view.


Credits, debits, firm, accounts, accounting concepts, bookkeeping, financial transaction, accounting system, Luca Pacioli, account group, double entry bookkeeping, duality of financial transactions.

Learning outcomes

At the completion of this training session, you will be able to answer the following focus questions:
    1. What is the origin of Debits and Credits?
    2. Why was it called Debit and Credit?
    3. What are the underpinning concepts for Debits and Credits?
    4. How would they have applied Credits and Debits in the 1400′s?
    5. Is there another way to look at applying Debits and Credits?

Introduction – Debits and Credits

The dictionary defines Debits and Credits, for the bookkeeping system, as Debits ‘being those entries recorded on the left side’ and Credits ‘being those entries recorded on the right’ side. Now some people are comfortable with this definition and after learning all the other rules and axioms of bookkeeping, go on to become very good bookkeepers.

About generalfinance13

General Finance is a place for understanding the basics of financials and accounting, because in order to develop in your career you need to excel in what you do, and we will provide you with good techniques to improve your skills.

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: