{"id":130,"date":"2020-09-24T11:46:00","date_gmt":"2020-09-24T10:46:00","guid":{"rendered":"https:\/\/www.thetrainingplace.org\/blog\/2020\/09\/24\/double-entry-for-beginners-part-3\/"},"modified":"2024-11-22T14:07:58","modified_gmt":"2024-11-22T14:07:58","slug":"double-entry-for-beginners-part-3","status":"publish","type":"post","link":"https:\/\/www.thetrainingplace.org\/blog\/2020\/09\/double-entry-for-beginners-part-3\/","title":{"rendered":"DOUBLE ENTRY FOR BEGINNERS &#8211; PART 3"},"content":{"rendered":"<p><b style=\"mso-bidi-font-weight: normal;\"><u><span style=\"color: #4472c4; font-family: 'Arial',sans-serif; font-size: 14.0pt;\">DOUBLE ENTRY FOR BEGINNERS<\/span><\/u><\/b><\/p>\n<p><b style=\"mso-bidi-font-weight: normal;\"><u><span style=\"color: #4472c4; font-family: 'Arial',sans-serif; font-size: 14.0pt;\">SALES SCENARIOS- PART 3<\/span><\/u><\/b><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Financial Accounts are built on the double entry principle which states that:<\/span><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">\u00a0<\/span><\/p>\n<p><b style=\"mso-bidi-font-weight: normal;\"><span style=\"font-family: 'Arial',sans-serif;\">FOR EVERY DEBIT ENTRY, THERE MUST BE A CORRESPONDING CREDIT ENTRY; <\/span><\/b><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif;\">So, in posting any transaction into your accounts, you always need to identify which account needs to be debited and which account needs to be credited. <\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif;\">A common acronym used to learn the double entry is <b style=\"mso-bidi-font-weight: normal;\"><span style=\"background: yellow; mso-highlight: yellow;\">DEAD\/ CLIC<\/span><\/b><\/span><\/p>\n<p><b style=\"mso-bidi-font-weight: normal;\"><span style=\"font-family: 'Arial',sans-serif;\">DEAD<span style=\"mso-tab-count: 7;\">\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 C<\/span>LIC<\/span><\/b><\/p>\n<p><b style=\"mso-bidi-font-weight: normal;\"><span style=\"font-family: 'Arial',sans-serif;\">Debit: Expenses, Assets, Drawings<span style=\"mso-tab-count: 2;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>Credit: Liabilities, Income, Capital<\/span><\/b><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif;\">\u00a0<\/span><\/p>\n<p><b style=\"mso-bidi-font-weight: normal;\"><span style=\"font-family: 'Arial',sans-serif;\">DEBIT TRANSACTIONS<span style=\"mso-tab-count: 4;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>CREDIT<br \/>\nTRANSACTIONS<\/span><\/b><\/p>\n<p><b style=\"mso-bidi-font-weight: normal;\"><span style=\"font-family: 'Arial',sans-serif;\">\u00a0<\/span><\/b><\/p>\n<p><b style=\"mso-bidi-font-weight: normal;\"><i><span style=\"color: #7030a0; font-family: 'Arial',sans-serif;\">If any of these are increasing, If any of these are increasing,\u00a0<\/span><\/i><\/b><b style=\"mso-bidi-font-weight: normal;\"><i><span style=\"color: #7030a0; font-family: 'Arial',sans-serif;\">you will need to debit the account you will need to credit the account<\/span><\/i><\/b><i><\/i><\/p>\n<p><b style=\"mso-bidi-font-weight: normal;\"><i><span style=\"color: #7030a0; font-family: 'Arial',sans-serif;\">and vice versa, if it is decreasing and vice versa, if it is decreasing<\/span><\/i><\/b><b style=\"mso-bidi-font-weight: normal;\"><\/b><\/p>\n<p><b style=\"mso-bidi-font-weight: normal;\"><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Let\u2019s test ourselves:<\/span><\/b><b style=\"mso-bidi-font-weight: normal;\"><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">\u00a0<\/span><\/b><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif;\">Please go through the sales scenarios Part 1 and Part 2 teachings and now test yourself; what<br \/>\nwill be the double entry posting for each of these, where VAT is charged at 20%:<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif;\">1. If you sell \u00a3340 net worth of products to a customer and payment was made immediately into<br \/>\nthe bank account.<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif;\">2. If you sell \u00a390 net worth of products and payment was not made immediately.<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif;\">3. If you sell \u00a3245 net worth of products and payment was made in 30days.<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif;\">4. If you sell \u00a3370 net worth of products and payment was not made immediately.<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif;\">5. If you sell \u00a3150 net worth of products and payment was made immediately in cash.<\/span><\/p>\n<p><b><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Answers:<\/span><\/b><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Dr- Bank (asset)<span style=\"mso-tab-count: 4;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a3408<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Cr- VAT (liability)<span style=\"mso-tab-count: 4;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a368<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Cr- Sales (income)<span style=\"mso-tab-count: 4;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a3340<\/span><\/p>\n<p>&nbsp;<\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Dr- Debtors (asset)<span style=\"mso-tab-count: 2;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span><span style=\"mso-tab-count: 2;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a3108<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Cr- VAT (liability)<span style=\"mso-tab-count: 4;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a318<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Cr- Sales (income)<span style=\"mso-tab-count: 4;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a390<\/span><\/p>\n<p>&nbsp;<\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Dr- Debtors (asset)<span style=\"mso-tab-count: 2;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span><span style=\"mso-tab-count: 2;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a3294<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Cr- VAT (liability)<span style=\"mso-tab-count: 4;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a349<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Cr- Sales (income)<span style=\"mso-tab-count: 4;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a3245<\/span><\/p>\n<p>&nbsp;<\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Dr- Debtors (asset)<span style=\"mso-tab-count: 2;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span><span style=\"mso-tab-count: 2;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a3444<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Cr- VAT (liability)<span style=\"mso-tab-count: 4;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a374<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Cr- Sales (income)<span style=\"mso-tab-count: 4;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a3370<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">\u00a0<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Dr- Cash (asset)<span style=\"mso-tab-count: 4;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a3180<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Cr- VAT (liability)<span style=\"mso-tab-count: 4;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a330<\/span><\/p>\n<p><span style=\"font-family: 'Arial',sans-serif; font-size: 12.0pt;\">Cr- Sales (income)<span style=\"mso-tab-count: 4;\">\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0 <\/span>\u00a3150<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>DOUBLE ENTRY FOR BEGINNERS SALES SCENARIOS- PART 3 Financial Accounts are built on the double entry principle which states that:\u00a0 FOR EVERY DEBIT ENTRY, THERE MUST BE A CORRESPONDING CREDIT ENTRY; So, in posting any transaction into your accounts, you always need to identify which account needs to be debited and which account needs to &#8230; <a class=\"read-more\" href=\"https:\/\/www.thetrainingplace.org\/blog\/2020\/09\/double-entry-for-beginners-part-3\/\">Read More<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-130","post","type-post","status-publish","format-standard","hentry","category-uncategorised"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>DOUBLE ENTRY FOR BEGINNERS - PART 3 - The Training Place Blog<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.thetrainingplace.org\/blog\/2020\/09\/double-entry-for-beginners-part-3\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"DOUBLE ENTRY FOR BEGINNERS - PART 3 - The Training Place Blog\" \/>\n<meta property=\"og:description\" content=\"DOUBLE ENTRY FOR BEGINNERS SALES SCENARIOS- PART 3 Financial Accounts are built on the double entry principle which states that:\u00a0 FOR EVERY DEBIT ENTRY, THERE MUST BE A CORRESPONDING CREDIT ENTRY; 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